Running your own business can be a massively fulfilling endeavor. But it’s no cakewalk. You probably deal with your fair share of difficult clients, scope-creeping projects, and — worst of all — clients who ghost you when it’s time to pay your invoices.
This is not just a minor inconvenience. Cash flow is one of the major reasons many small businesses fail. And outstanding invoices can cause:
Delays in your ability to pay your own expenses
Precious time and energy wasted chasing down withholding clients
So, getting paid faster sounds like a good idea, right? Here’s how…
1. Automate Invoicing With Cloud Accounting Software
Getting paid really starts with sending your invoice. But carving out time to create invoices in the first place is a bit of a chore — and probably not as exciting as the actual work you do. This is where cloud accounting software, like FreshBooks, can be a game-changer.
These tools make it easy and fast to generate invoices by automating a lot of the steps involved. Fields like dateline, new invoice number, client contact information, etc. can all be auto-completed. This not only makes it easy to generate your invoice promptly for a completed project, but it also minimizes your chances of error. Because errors can cause payment delays.
As a HubSpot customer, you can integrate FreshBooks directly with your HubSpot account and keep your workflows streamlined. Once you convert a HubSpot lead into a customer or evangelist, their contact details are pushed into FreshBooks and you’re ready to start billing.
2. Invoice in a Timely Fashion
If you wait until month-end to send your invoice (or just plain forget), you’re doing your business a big disservice.
Back in the day of mailed invoices and checks-in-the-mail, it wasn’t unusual to wait until the end of the month and do all your invoicing as one major task.
But, when it comes to getting paid, the timing of sending your invoice is really everything. Generally, our advice is: invoice your clients as soon as work is complete.
If you’re working on a larger project, consider invoicing at key project milestones rather than waiting until the end of the project. This also means your clients won’t be hit with one huge invoice, rather several smaller ones, which helps them distribute their costs.
3. Use Proven-to-Get-You-Paid Invoice Terms
Invoice payment terms are generally added to invoices to simply state when payment is due and what the late payment penalties are.
Net-30 (i.e., payment due 30 days after receipt of invoice) was always the norm. But, again, that was in the days of check runs and paperwork. With more payment options nowadays, it’s acceptable to have payment terms on a tighter timeline.
Plus, jargon like “Net-30” may not be as clear to less business-savvy clients. To eliminate any confusion on your client’s end, use plain language and state the invoice payment terms in days (e.g., “Please pay within 30 days”).
Besides, according to FreshBooks research, people who include a “please” and “thank you” on their invoice tend to get paid faster. Always remember there’s a human receiving your invoice — thanking them for their business helps reinforce and maintain that client relationship.
4. Make It Easy for Customers to Pay You
If you set your invoice terms to Net-5 (i.e., payment due five days after receipt of invoice), it’s important to enable a payment method that makes it easy for clients to hit that deadline.
It’s unrealistic to expect them to turn around a check on this timeline. With cloud accounting software, you can enable payment methods like credit card or ACH payment (bank transfer) to get paid faster.
This not only helps you get paid quickly but makes it really easy on your client. Your invoicing process will seem professional and convenient for them: a win-win.
5. Automate Your Invoicing as Much as Possible
Although cloud accounting software makes invoicing way easier than using Word or Excel, it can still be a significant task for those who do a lot of billing.
Thankfully, software like FreshBooks lets you put invoicing on auto-pilot with features like:
Recurring invoices: Set up recurring invoices once for clients frequently billed on a consistent basis, e.g., every two weeks, etc. The invoices will be sent out automatically so you don’t have to create one every single time.
Automatic late payment reminders: If clients do stall on payment, it can often lead to an awkward follow-up conversation. With cloud accounting, you can automate email reminders, starting with a gentle reminder and moving to a more direct approach as the overdue period continues.
Automatic late payment fees: If a client has two different invoices to pay and only enough money to cover one, they’ll likely choose the invoice that will incur extra costs if paid late. Automatically adding late payment fees (stated upfront in your payment terms) can really help nudge a payment along.
Any repetitive task can most likely be automated with cloud accounting software. And automating all of these tasks saves precious time for you. But more importantly: these automations will help take care of your business financials, even when you are occupied with other aspects of your business.
Conclusion: Stop Struggling With Unpaid Invoices
Every business owner knows the woes of unpaid invoices. They can range from a pesky problem to a major — business-threatening — complication.
It makes sense to invest in options to help ease your billing processes so you can get paid faster. Plus, your clients will thank you for it. After all, just like you, they want easy workflows and clean paperwork to simplify tax season.
By connecting your CRM tool with your invoicing and accounting software, you can add another layer of efficiency to your business operations. And, thanks to the FreshBooks integration with HubSpot, you’ll have an easier time seeing which invoices are getting paid (and which ones aren’t), all without leaving HubSpot.
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Originally published Jan 29, 2020 10:00:00 AM, updated January 29 2020