The late invoice payment is a headache for a small business owner and late payment may become a serious issue for your business. Payment is a most important factor in your business and if you don’t get your payment on time then it may harm your business growth. This article may help how you can get rid of late invoice payments.
First of all, you should know the consequence of late invoice payment. The late invoice payment may a huge impact on your business and your employees, you may go out of cash and may not be able to pay salaries to your staff, you may be late to pay the bills and payment which may affect your image in the market.
The research shows that on a small business owner have to wait for an average of 15 days to get payment through cheque and approximately a month to get a cash payment.
Research on a customer:
The customer is a key element in a business and you may not do a business with any customer. You have to make your customers happy whether through an offer and discount or through allowing him to pay after some time. But make sure that customer will pay all his bills before the deadline, you should do research on him before making any decision. You should know the behavior and nature of your customer this may help you to get rid of those late payments.
Handle all your invoicing carefully:
One thing which you can do is to handle all your invoicing carefully so that you can get a proper look on your paid and unpaid payments which is so important. An accountant or an invoicing software may help you on this, there may chances that you may forget to take followup of any unpaid payment in that case an invoicing software may help you and notify you regarding that unpaid payment.
Take proper follow-ups regarding unpaid payments:
Follow-ups play the most important and crucial role to get rid of unpaid payments. You should take proper follow-ups regarding unpaid payments there are certain rules which you should follow while taking the follow-ups. The first and ground rules to “be patient and wait” to should make at least for 10-15 days before sending any notification to the customer. The first notification should be a written notification you may send message or mail to the customer as a reminder, after a week of that reminder you may call him and remind him.
Late fees or interest may help you:
The best way to get rid of all those late payments is to charge extra with respect to time. If you will charge extra amount according to your policies then this can help you. An average customer doesn’t want to pay more for anything and he always wants to save his money that’s why when you charge extra money for late payment then you will notice that the customer always pay that payment before the time.
Late payment may also affect your tax payment and its become too hard to calculate the proper tax. You may set a rule and try to avoid late payment as much as you can this can be beneficial for your business and customers. If you don’t allow late payment the customer always pay you in advance. If are allowing late payment then be safe and do a proper paperwork which can play a crucial role to get rid of the late invoice payment.