![]() Having payment terms will also help keep your communications professional. This should be a last resort, after you’ve exhausted all other options. When will you escalate and how? You may decide to work with a third party collection agency or get legal help if the outstanding amount is significant and you’ve been waiting a long time for it.Make sure to do a little research on the law in your area as there are often legal restrictions on what late penalties you can impose. Early payment discounts are nice if you can afford them, but late fees help you recover some of the cost of the extra time you spend chasing unpaid invoices. Will you offer an early payment discount or impose late fees ? Either way, you’ll need these in the contract before you begin work.How long of a window will you give? Your invoice should include the window of time a customer has to pay you-terms like Net 30 and Net 15 are good shorthand, but it’s nice to spell it out in plain language, like “Payment is due 15 days after receipt of this invoice”.They should be included in the contract your client signs at the beginning of your work together, so they’re enforcable later. Payment terms spell out when and how you and your client agree you should be paid, and what happens if you aren’t. But how soon before the due date you’ll send them (and how often to follow up) will depend on your payment terms. It’s a good idea to send a payment reminder shortly before the due date of the invoice, one shortly after, and then regularly after that. Ideally, you should structure your reminder schedule around the payment terms in your contract. The best payment reminder emails are both effectively worded and effectively timed. Having a system for sending them is the first step in making it a habit! Timing your emails is key In addition to helping remind clients that they have outstanding invoices, payment reminders can help you clear up any invoicing errors or payment issues, and warn clients about upcoming measures like late fees or collections. But remember that it’s really a professional courtesy to send them, as long as they’re worded nicely and sent promptly. A lot of business owners feel uncomfortable asking directly for payment. If you cringe at sending payment reminder emails and letters, you’re not alone. It’s a chore, but sending payment reminder emails to clients is an important way to help keep your cash flow healthy. In a perfect world, you’d be paid on time, every time-but unless you have a point of sale business model, you’re probably all too familiar with chasing payments from clients.
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