Write up a document that goes along with your contract that details your terms for project or product payments. This way, your customers know what to expect once they enter into a business relationship with you. You can do this by setting your terms and conditions early on. If you want to prevent late payments, then do something about it in advance. Here’s a saying that you can apply to any area of your life or business. Late payments are a red flag for bad customers.īut don’t let this deter you from trying to reconcile the relationship on a professional note. You’re a good business and you deserve good customers. But if you allow customers to get away with paying late or not at all, then what’s to stop them from doing it again in the future? They don’t want to badger a customer due to fear they’ll never return. This is an issue that’s prevalent, especially among new business owners. First – Don’t Feel Intimidated to Send Payment Reminders So how do you prevent this from happening to your business? Well, there’s a professional way to go about sending a payment reminder to customers. With on-time payments, SMBs would be able to hire an astonishing 2.1 million employees. 23% can’t afford to hire more employees.79% of owners can’t pay their own salary.Here’s a look at the effect late payments have on small businesses: Instead, their business and livelihood becomes threatened by late payers. That’s money that could go towards equipment, supplies, marketing, and employee salaries. That’s about $84,000 owed per small business. There’s an estimated $825 billion in unpaid invoices to American small business owners. A whopping 82% of small businesses fail because of poor cash flow management.Īnd what causes this? Clients not paying invoices in a timely manner. Late payments are more than annoying-they’re crippling, especially to small businesses. The sad news is that no matter how hard you work or how great of a job you do, there will be customers who don’t pay on time. You go above and beyond to ensure they receive the best product or service.Īfter all, your reputation is on the line and anything less will have prospects and customers running to your competitors. As a freelancer or business owner, you work hard to please your customers.
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