Top tips for avoiding late invoice payments in your company

Every (small) business owner has encountered the issue of late payments from clients. This can have a serious impact on cash flow, particularly for smaller companies. This is why we've compiled this short guide to getting your business invoices paid. And the best part? This is without having awkward conversations with your clients.

Submitting of invoices: The earlier you initiate the billing process, the better - it is advisable to issue an invoice as soon as the project in question is finished. This tends to lead to quick payment as the client is still involved with the project. If you send an invoice immediately, it will also underline the importance of you getting paid and make you look professional. This can also help avoid confusion with different accounting periods.

Client contact: To get paid faster, it is beneficial to have a specific contact at the accounting department of your client organization. This is even more important if the organization in question is big. Find out how is in charge of payments and send all the invoices directly to them. When you send an invoice to the person in charge rather than it being passed around in your client organization, payment is likely to be quicker.

‍Accurate invoicing: You are unlikely to be paid on time if there are mistakes on the invoice itself. Whether you issue invoices manually or use a small business invoicing software to find invoice templates, ensure the invoices are clear and professional. The document or invoice template needs to include payment details (purchase order number, description of the product or services, date of supply, bank details/ bank account, and name of the project manager).

Automated invoicing: If you decide to use an invoicing system to send invoices automatically, you might be able to also set up automatic payment reminders. This can be done regularly for repeat clients and save you having to send chaser emails. Another option is to set up direct debit payments.

Payment options: If customers have several ways to pay your professional invoices, they will have a smoother payment experience and are therefore more likely to pay quickly. It is advisable to let clients pay using a range of options, including credit card, debit card, and Google or Apple Pay. It is also crucial to list these options clearly in the payment terms on your invoice.

Deposits: If unpaid invoices become a continuous problem, you can consider taking upfront deposits for your services. Many small businesses implement eg 50%-deposit-rules, ensuring they get paid at least half of the total amount before commencing work on a project. This can create positive cash flow for your business.

There are several invoicing software tools available, helping you to automate and streamline the process. If you are unsure about creating an invoice, use free invoice templates available online.