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Running a business only works if you get paid. Sending out invoices with no answer from the client or customer can cause you to pull your hair out and stay up all night wondering how you’re going to pay the bills.
Now that GoDaddy Online Bookkeeping also includes a new Invoicing feature, we’ve taken a marked interest in how our customers invoice. And we’ve come up with several best practices that seem to get invoices paid promptly and in full.
Don’t like contracts as you feel they “get in the way?” It’s time to change that viewpoint. Contracts not only help solidify the business relationship, meaning the client will take the transaction more seriously, it also gives you a safety net if they do decide to take off with the finished project or product.
2. Accept Early Payments
While it may be a little unorthodox, some clients like to pay as early as they can so they can go ahead and get it out of the way. (This generally happens around the end of the year when they are trying to get all those tax deductions ironed out.) The last thing you want to do is to tell them just to wait until the project is finished. Who knows what will happen in the meantime? Go ahead and take it and use it as incentive to do your best.
3. No Dawdling
When the project is done, don’t take forever to send the invoice. Yes, the client should theoretically know to pay now that the final product has been delivered. But that’s only in theory, and not sending an invoice immediately gives them the opportunity to put it off. Don’t give them any excuses to slow pay!
4. Iron Out Details
The last thing you want right before you get paid is the client ringing you up and saying “but I thought so and so!” When putting your contract together, go over every last detail including the ultimate invoice and the payment date. The less you cover the more likely there will be a misunderstanding later.
5. Widen Your Payment Options
You might only like taking checks but that doesn’t mean everyone likes to pay with them. Accept as many payment options as you can, including credit cards and online payment processors like PayPal. The more options you have, the more likely you’ll have something the client likes to use, which means less hassle when paying you.
Sometimes it seems like businesses don’t take what you’re doing seriously. Nothing fixes this quicker than requiring a deposit up front. The best thing about taking deposits is you get to choose the rate – for example, if you work with a client for years, you can lower the deposit percentage or get rid of it altogether.
7. Following Up
How long do you have to wait before you start following up with your customer or client? If you have a contract, it should be immediately after the payment due date. Contact them when an invoice is overdue, and if a problem arises, increase the frequency of contact until they pay up. The squeaky wheel usually gets the grease!
Now you can manage your income, expenses, taxes, reports and Invoices all in your GoDaddy Online Bookkeeping account. Check out our new “Invoices” tab today and customize your first invoice!