Most of the time, small businesses don’t have an investor to back them. So, they need to have a stable cash flow. Else it can lead to bankruptcy if you are out of projects. For the same, it is necessary that you follow good invoicing practices and get paid on time.
Online invoicing software can help you send reminders and follow good practices to ensure that you are paid well before time.
If you wish to stay on top of online invoicing software, please make sure that you send your invoices on time, offer multiple payment gateways, and use the below-mentioned tips to stay cash flow positive at all times.
1. Try To Get Advance Payments
Getting advance payments is a no brainer. You can and must negotiate with your clients to get a part or full payment in advance. This is particularly useful for long-term projects as they may take many months to complete.
Moreover, you will have sufficient funds to cover project costs. Furthermore, when you maintain a cash flow, you will be able to manage other business expenses with ease.
2. Make Simple Invoices
A common mistake made by small businesses is that their invoices are full of errors and sometimes too complicated to understand. It is also possible that you have not conveyed information clearly and have not designed it well.
In these cases, your clients may find it difficult to find information and may end up getting confused. Thus, leading to delays in payments. The most important thing that should be done is to highlight the total amount and the deadline for the payment.
3. Be Prompt With Your Invoices
It goes hand in hand. You massively increase your chances of getting paid on time if you invoice on time. You can always send your invoice with the final draft of your work.
Making this a practice will keep your invoice fresh in the client’s mind, and they are more likely to pay you faster. Moreover, using online invoicing software will massively cut down on errors in billing.
4. Set Clear Payment Terms
Keeping a record of the discussed payment terms in your online invoice payment software is a must. Make sure they are crystal clear as it will help your clients know when and how they need to make payments and what will be the consequences of not making them.
5. Provide Multiple Payment Options
Offering multiple payment options with your online payment software can provide your clients with the much-needed flexibility, and they will consider paying it fast.
It will accelerate the payment process, make you look more professional, and you will be able to onboard new clients faster.
6. Have A Provision for Accepting Automatic Payments
Online invoicing solutions can help you receive automatic payments for your invoices. It will help you charge your clients on the same date each month. This will save effort for both parties and eliminate any guesswork.
7. Offer Incentives
Offering incentives is a great way to receive early payments and help clients develop this habit. A 2% discount is good if the payment is made within 10 days of the due date. While it is not much, it will show your clients that you care for them, and they will pay you faster.
8. Consider Charging Late Fees
Just like it is important to offer loyalty programs for good customers, it is all the more necessary to charge late payment fees for defaulters.
For this, you will need to discuss the late fee when you sign the contest and mention it in your payment terms.
This will cut down on unpleasant surprises and help you build long-term relationships. So, make sure to charge a nominal amount as late fees.
Online invoicing software can help you maintain a smooth cash flow and improve profit margins significantly. Besides, you will also be able to satisfy customers and build a long term relationship with them. So, get going and invest in online payment software today to get a hold of your finances and scale your business.