How would you feel if you serve your customers in a timely manner and with complete dedication but ultimately linger around receiving the payments for a long time? In reality, this is quite a tough part to handle as even your payments may be at hold for that time.
Here are 5 smart steps to make the process of payments easier and more of genuine responsibility for your clients:
Step 1: Take a peek at your accounts receivable policy
As an accountant, you must be aware of the fact that all customers are not the same. Those of you who are working with large institutions would surely be aware that the accounts receivable process takes around 30-45 days for clients to issue payment.
Smaller companies, on the other hand, may adjust these payment terms with closer boundaries. It is thus better to frame an easily manageable and comfortable policy for both your business and clients.
Step 2: You can think of charging a retainer payment
With this payment scheme, the customer will have to pay half the cost upfront and the other half when you deliver the product or service.
Step 3: Be in touch with your customers
You should not at all hesitate to pick up the phone in order to contact your customers. When you make a simple and courteous call to remind them about their pending invoices, it will always be a positive response in terms of account receivables.
You can also remind your customers by sending them monthly statements. This will not only speed up your collection but will also be imprinted in the minds of your customers and next time, they might not even wait for your call to make the payments in time.
Step 4: You need not to struggle with every customer
You should not hesitate to turn away those customers for whom you don’t feel too positive in the first place. The reason is that you probably can figure out that the potential customer doesn’t have the funds to pay you. If you are not comfortable working with that particular customer, then you should not waste your time and resources in serving them and also not get paid.
Instead, kindly refuse their work. If you really want to do their work, ensure to collect the payment pre-hand or on a pro-rata basis while marking the milestones.
Step 5: Double check your invoices
It’s necessary for you to double check the invoices which you send to your customers. By having a procedure set up, make sure that your invoices are looked into before they are sent to the customers. Everyone is busy these days but you don’t want your customers to take out time to correct your billing mistakes.
It will only result in a delay in you getting paid and also in a bad business image. So, ensure your accountants make it right every time.
With the help of these simple 5 simple steps, you should be able to collect your past due invoices in a fast and trouble-free manner. Though all these operations are easily available to be tracked by CPAs and individual accountants through QuickBooks modules and tools for financial management, yet these steps are often skipped out leading to delay in payments.
With Hosted QuickBooks, it’s not that the accountants have to sit for long hours at office to do the same. The entire team can work in coordination in a hosted multi-user manner and can send invoices to customers and update them anytime and from anywhere.
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