One of the most difficult tasks for a business owner is managing the accounts receivable. This is something, that if not watched closely it can impact your cash flow and the ability to successfully run your business.
No one likes to make the call to a client whose account is overdue – so how do you improve this process?
There are a number of ways you can encourage your clients to pay on time.
Make sure your invoice is easy to read. Your clients should be able to clearly see the total amount invoiced, any deposits, payments, interest and the balance owing. Make certain that the payment options are clear.
- Do you accept credit cards or cheques only?
- Who should clients make the cheque out to?
- Is your mailing address on the invoice?
- Include your phone number, in case a client has a question.
Provide incentives. Reward clients for paying early – everyone loves to get a deal. Include a small enticement (2% is common) for clients who will pay within 10 days.
Lose the 30/60/90 day columns. Using these columns might imply that your customer has the option of paying after 30 days. You should be very clear when the payment is due.
Draw attention to the amount owing. You could bold or mark in red, highlight or use an arrow to clearly indicate the balance due.
Janice Hollingworth
Business Development Officer | 
