For many businesses nowadays, the main goal in order to be successful is to attract customers and generate sales. While we shall never deny the fact that every purchase of a product counts, a complete payment is what it really takes to seal the deal.
Customers can be categorized into different variables like age, gender, geographical location, etc. But for the most part, there are only two types of customers: those that pay on time and those that do not. Dealing with clients-turned-debtors can be extremely tricky and can negatively affect the growth of a company.
If you’re one of those business owners who find it quite challenging to get their customers to pay on time, this article is for you.
Here are several tips on encouraging your customers to pay right away and avoid any unnecessary payment default issues in the future:
Send invoices as soon as possible
Managing a business requires you to take the initiative most of the time. So the tip here is do not wait for your accounts department or your bookkeeper to send the invoice to your customer. Thanks to modern technology, invoicing is now fast and convenient through a range of automated processes. The earlier you notify your customer, the higher the odds they will pay on time.
Offer a significant number of payment options
Being flexible when it comes to payment options can provide your customers multiple channels to make a payment and also increase the likelihood of them paying on time. Be mindful that your customers can have varying preferences on the way they want to send their payment. Payment could be made by cash, credit card, cheque, online payment system (EFT) or direct deposit. Regardless of their choice, its best practice to have as many payment options as possible to limit the chances of a late paid invoice.
Make everything clear by setting payment expectations and gentle reminders
Establishing rapport and effective communication with your customers is also a vital factor. You need to ensure everything is clear on how much and when you expect them to pay. Remember to send these reminders in a professional and gentle manner so as not to upset your customer which potentially could damage your company’s reputation. Failure to send out reminders may send the wrong message that it’s OK to utilize your services without paying on time.
Do not offer credit right away
If your company offers credit, try to avoid discussing it with your customers right away. Not offering payment terms immediately is still the best way to receive money for products or services rendered from day one. Fortunately, this tip can be applied regardless of whether you sell a product or a service. If your business provides a high quality product or service, your services are in demand, with most customers very willing to pay in advance or at time of delivery. You should only mention extending credit if asked or if your advised payment up front is not an option.
Seek the help of a debt collector
If your customers remain non compliant to payment terms despite your best efforts, it’s certainly time you seek professional help. For most people, getting a collection letter or phone call from a professional debt recovery agent is a huge wake-up call. Additionally, hearing from a reputable collection firm also demonstrates that you are serious about recovering the balance. Bottom line, it’s a powerful motivator, and as a result, debts get paid faster once a debt agency becomes involved.
Brodie Collection Services is a full-service agency offering a multitude of services and is one of Australia’s leading debt collection firms. Our objective is to provide you with expert debt recovery and advice at a price lower than the market cost. Our recovery approach is simple – we strive to get to the bottom of why you’re not being paid, then implement steps to ensure prompt payment. With 25+ years’ experience in debt recovery, we have undeniable results proving that debtors will pay once we become involved.
With offices in Melbourne, Adelaide, and Brisbane, we can assist will all your collection & recovery, legal support services, and credit risk management requirements.