Unfortunately, chasing late invoices is just part of running a business that sells on payment terms.
Cumulatively, UK small and medium enterprises (SMEs) are owed a combined £50 billion in late payments. The average business is wasting time and money chasing eight invoices, each worth around £8,500 each.
Thankfully, there are ways you can overcome the inherent awkwardness of asking for the money you’re owed and get paid faster and more punctually.
Set clear payment terms
The first step in implementing effective credit control is to be proactive. Since most business transactions start with a contract, you need to have firm payment terms in place.
Having a clear payment date and setting out what happens if the customer pays late is the best way to avoid miscommunication. If your payment terms are watertight, then it leaves your customers very little wiggle room when it comes to paying you.
Remember, if you’re in the UK, you have the statutory right to levy both late payment interest and claim compensation on late invoices.
If you do have doubts about your client’s ability to pay on time, you could always ask for a deposit. If both of you are dealing in a fair and open manner, then a deposit shouldn’t be an issue. A customer immediately refusing the idea of a deposit is usually a red flag.
Take advantage of the benefits of automation
Chasing for payment is both time-consuming and awkward. Thankfully, by taking advantage of the benefits offered by automated credit control platforms like Chaser, you can significantly reduce the time spent administering to your accounts receivables.
Chaser allows you to automate the credit-control process, sending proactive upcoming invoice reminders and a range of scheduled late payment reminders.
Instead of filling your calendar with set dates for invoice chasing and handcrafting emails you can simply adapt one of Chaser’s email templates and schedule it to send in advance.
We fully understand how easy it is to ignore obviously automated emails, which is why Chaser’s platform combines the benefits of automation with the human touch. All your chasing emails appear to come from your personal email account and easily adaptable templates reflect your brand voice.
You can schedule different invoice reminder templates to send at different times before the invoice is due, once the invoice is overdue and even on the date it is paid. If one customer has multiple overdue invoices, Chaser automatically groups and chases these together for you,, to avoid the batch sending that is such a red flag for automation.
Through the use of Chaser’s automated credit control, Xero and Chaser users are able, on average, to save 15-hours per week on chasing late invoices, get paid 16 or more days sooner, and have a 25 per cent reduction in days sales outstanding.
Make it as easy for your clients to pay you as possible
The best way to get paid is to make it as easy for your clients to pay you for your work as possible.
Each Chaser invoice reminder includes a link to your customers’ unique Payment Portal, where they can pay you through your chosen payment platform, so rather than having to resend your invoice, your customers can pay directly from a reminder email.
Each Payment Portal also includes all the required payment information your customers need through a dedicated summary page.
The summary page allows your customer to see an overview of all outstanding and paid invoices, so unpaid bills don’t stack up into surprisingly large amounts. This also allows your customers to pay for all their outstanding invoices at the same time and keeps you both on the same page about what’s due, when.
In order to give your customer every opportunity to pay you promptly, Chaser’s Payment Portal supports a range of payment options. In addition to the usual credit and debit card payments.
Get the experts to chase for you
If you’re struggling to get control over your accounts receivables and outstanding invoices are starting to strangle your cash flow, then it might be time to outsource your credit control to the professionals.
Alongside our award-winning credit control platform, Chaser’s Outsourced Credit Control offers you the chance to have a professional credit control specialist working for your business for as little as £270 per month.
Rather than paying an average of £22,000-£30,000 a year for an in-house Credit Controller, you can have all the benefits for a flat monthly fee. Our monthly fee model makes it easier to control your cash flow through a predictable spend, rather than a viable commission model.
Our services are completely transparent. When you sign up for Chaser’s Outsourced Credit Control service, you also get full access to the Chaser software and the ability to view all our credit control activities and communications with customers on your behalf.
Don’t be afraid to escalate your debt recovery efforts
If chasing late payments is awkward, then moving beyond just sending reminders is positively excruciating. Most small business owners would rather write off bad debt than go through the lengthy hand over process associated with debt collection agencies.
Additionally, great customer relationships, and the repeat custom that comes with them, is vital to most SMEs. The aggressive and harassing tactics favoured by traditional debt collectors can destroy your carefully built up business relationships, ruining any chance for further work.
However, there is another option.
Chaser’s debt collections service uses polite persistence and friendly collections to get you the money you’re owed without any negative impact on your customer relationships.
Our highly trained teams mediate between you and your customers to find a payment solution that works for everyone, without the aggression.
Even better, instead of wasting your time collecting the documents needed for a lengthy handover, you can escalate invoices to our debt collections team straight through the Chaser software. The relevant data is already held in Chaser, so handover time is reduced to just a few clicks.
Effective collections without the awkwardness
Chaser’s combination of automation and innovative credit control solutions lets you recover the money you are owed, without any of the awkwardness.
We’ve helped our customers successfully and smoothly recover over $4billion in late payments in total to date, and we can do the same for you.
So, if you’re struggling with your accounts receivables, reach out to us today to find out how we can help.