The goal of the collection process for any freelancer or small business owner is to receive money owed as quickly and efficiently as possible. Collection of payments owed should be handled in a way that is professional, friendly, and simple for all parties. Here are some guidelines that will keep your collections running as smoothly as possible.
Predict Ambiguities:
This is achieved by clearly explaining the terms of payment, such as whether you prefer to receive cash or check. Online payment options are also widely accepted as a standard.
Know your clients. Offer choices and alternatives that can work for any business - big or small. Flexibility to your clients needs is as important as Consistency. You can enable your clients to choose their own payment schedule or offer options of phased payments, offer discounts for early payments or even negotiate payments owed. Statistically, the more flexibility that is offered, the more likely you will get paid more of what you are owed. If both parties are satisfied with the payment terms, then be sure that a clear agreement is signed and documented to prevent any inconsistencies.
Promote Flexibility and Consistency:
Develop a system for requesting payments. Again, allow for flexibility and renegotiation of terms, within a clear and consistent framework. Allow your clients to opt-in to payment reminders that fit their schedule and budget. These alerts could become reminders of late payment past a certain date.
A great way to automatically send late notices or reminders is with a free online business form service such as Fastdue.com. You can send an invoice, a past due notice, create an online agreement, or file an online complaint. Not only does FastDue keep clear accounts of what is owed and what is paid, but you can also upload your unique company logo! This saves you the time of creating these forms yourself while also allowing you the flexibility to promote your brand image. Once your clients receive an online invoice, you can accept their payment through a secure PayPal or credit card transaction.
One benefit to using a collection system like FastDue, is that interactions with clients is immediate, professional and friendly. Confidence is instilled when communication channels are open and response rates are high.
Tuesday, September 30, 2008
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Another final strategy if they aren't answering you phone calls and won't respond to your invoices is to visit them in person. It's always harder to be ignored if you're physically there ... they have less opportunity for giving an excuse.
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