Not getting your invoices paid on time can wreak havoc on your freelance finances, not to mention the strain it can put on client relationships.
Here are 3 simple but astute things you can do to help create a robust collections process, improve freelancer-client relationships, and get your invoices paid on time.
1. Set out clear payment terms and conditions in writing
It’s important that you set out clear payment terms and conditions in writing from the outset so both parties are fully aware of your fees and payment terms, i.e. when you will invoice, how much you will invoice, when the payment is due, and how to pay you.
It might be that you ask for a deposit upfront and so only commence the work once the deposit is paid, or you may offer milestone invoicing for longer projects (where you are paid at specific points throughout the duration of the project), or you may invoice monthly or immediately at the end of the project.
However you charge, terms must be explicit upfront; for example, you may charge a late payment fee or apply a discount for early payment to encourage prompt payment. You need to be clear about any late payment fees and be willing to enforce them.
Your acceptable payment methods are another important element of your payment terms and conditions. It’s worth noting that some payment methods might not be available to your clients or are inconvenient, especially if you have overseas clientele. Making it easy for clients to pay you by accepting various payment methods means your invoices will most likely be paid more promptly.
Invoice Ninja offers multiple payment gateways. A payment gateway is the tech that allows your clients to pay you securely and swiftly online. Multiple payment gateways give your clients more choice in how they pay your invoice. Our payment gateways include Stripe, PayPal, GoCardless, and more. Plus, our BTCPay Server integration means you can now receive Bitcoin payments directly to your wallet with no fees.
Integrating your Invoice Ninja account with a payment gateway allows clients to pay their invoices with 1-click! The payment gateway processes the transaction in the background, so your client never has to leave their Invoice Ninja client-side portal. A portal also means that clients can easily view their invoice history and pay any outstanding invoices instantly.
See all our payment gateways here.
Try Invoice Ninja for free here.
2. Send at the right time, in the right format, and to the right person!
It’s paramount that you send your invoice on time and to the right person, especially if you are working for a large organization with many departments and processes that your invoice needs to go through to get it signed off and settled.
Not addressing it to the right person could mean the payment is delayed. It’s often the case that the person you are dealing with on a project isn’t the person responsible for making payment. Furthermore, if you don’t send your invoice on time, it can also mean your payment will be delayed. This could be because the client only processes invoices on a particular date, expects to receive an invoice from you but doesn’t, or simply that you sent it after it was due! If you are working with a public institution in Europe, for example, there may even be other protocols you need to follow, such as adopting the European standard of e-invoicing (PEPPOL).
In any event, you’ll want your invoice to look professional and include accurate data and other necessary details such as invoice number, due date and payment instructions, as well as accurate line items and work completed, to name just a few.
As well as a host of payment and automation options, Invoice Ninja includes attractive, professional invoice template designs you can customize with your logo and brand colors, making the whole experience of paying you branded, professional and seamless.
You can find out more about how to boost your brand at our post here.
3. Follow up
If, for whatever reason, you haven’t received payment of your invoice by its due date, then a short, friendly email reminder to your client to prompt them to make payment can go a long way. Alternatively, give your client a quick call. If you’ve nurtured a positive client relationship, this can also help to encourage prompt payment of your invoices.
A more efficient and less time-consuming process is to use automated reminders and follow-ups. With the Invoice Ninja Pro Plan, you can create custom email reminders based on the invoice date or invoice due date. You can set them up so they are sent automatically at the frequency and timing of your choice. You can set “First, Second, Third” or “Endless” reminders to ensure invoices are not overlooked and you get paid faster!
Following up on unpaid invoices (accounts receivable) is an important bookkeeping task that, if not done promptly, can hinder cash flow, so it makes sense to establish a clear strategy and process for payment collection for your freelance business.
Once set up and implemented, a robust collection process should ensure your invoices are always paid on time.
