If you’re reading this then you’ve no doubt found yourself in a situation where you’re either constantly chasing down clients for payments, or are writing off unpaid invoices. And it’s costing your business.
Fortunately, you’re in the right place!
What Is an Automated Invoice Reminder?
Simply put, this is quality software that will set up automatic notifications sent directly to your customers reminding them to pay their invoices. These can be sent via email, text or WhatsApp, depending on the preferred communication platform.
What Are the Risks of Delayed Invoice Payments?
If you are one of those business owners chasing after payments, then you’re probably experiencing some of the following challenges:
- Cash flow issues: Your expenses are still piling up even if your payments are being made so this makes it harder to pay suppliers and staff. This is one of the biggest risks to a business, even if you’re providing an excellent service or product.
- Missed payments: Eventually you’ll start missing payments for bills, rent and supplies, forcing you to reshuffle cash and resources to cover the basics.
- Knocks the confidence: A lack of cash flow puts you in a precarious position which impacts your confidence as a business owner.
- Business planning: Without being on a solid footing financially, it’s incredibly difficult to make any plans for the future of your business.
What Are the Benefits of an Automated Invoice Reminder?
So you know what the problems are when your customers aren’t paying on time, now we’ll take a look at how an automated invoice reminder can really help your operations.
Reminders Improve Efficiency
Just trying to get one invoice paid on time, while maintaining good customer relations, could result in up to five ‘accounts payable’ emails at a time. This takes a lot of time and money away from your more important business-enhancing activities. By implementing an automated invoice reminder, the customer receives the invoice immediately. Then – should payment not be forthcoming – they’ll receive helpful reminders on set dates until the invoice is settled. This means more efficiency in receiving your payments, with more time directed to business operations.
Reminders Minimise Barriers
If you’re manually mailing invoices to your customers, then this system is definitely for you! With an automated invoice reminder, your customers are getting the invoice directly on their preferred device – computer, tablet or phone – via email, text or WhatsApp. You can also set it so that the reminders are sent to them at a convenient time when customers are checking emails and are more likely to make the payment.
Reminders Come in Different Forms
As mentioned, you can customise the communication platform you’d prefer for the automated invoice reminder. Some customers never check their emails, so it would be pointless to keep corresponding with them in this way – you might as well just post it! With an automated service, you can send the reminder directly to their phones, which they can then use to settle the account. Adjusting the communication channel to the customer shows interest in the customer and saves you time.
Reminders Offer Different Payment Methods
In addition to customising the reminder platform, the automated invoice reminder will also provide your valued customers with a variety of payment options. This is key because people are quite particular when it comes to the way in which they choose to pay for a product or service – whether it’s an EFT transfer, credit or debit card payment or another payment portal. Your automated invoice reminder will allow the customer to link directly to their preferred payment option, minimising any delays in payment.
Reminders Keep Your Books Up-To-Date
With an automated invoice reminder, you’re able to keep that cash flowing and your books updated at all times. When it comes to tax season, you’ll be very grateful that all invoices have been settled.
“With an automated invoice reminder, you’re able to keep that cash flowing and your books updated at all times. When it comes to tax season, you’ll be very grateful that all invoices have been settled.”
How Do Automated Invoice Reminders Work?
If you’ve read this far, then those benefits are definitely speaking to you! Now you just need a better understanding of how the system works. In this section, we’ll take you step-by-step through the reminder process.
1. Pre-Reminders Sent
If you have an automated invoicing system, that’s great as this means your invoices are being distributed quickly – which is also key to encouraging prompt payment. If payment isn’t made immediately, then it’s time for the automated invoice reminder to kick in. These can be scheduled to reach customers at various intervals, such as two weeks ahead of the deadline, a week, three days and then the day before. Obviously, you don’t want to harass your customers, but some gentle prompting often does the trick.
2. Due Date Reminder
On the date that the invoice is due, your automated invoicing service can send an email or text alert to the client, with an easy clickthrough. This will enable them to pay then and there. If the ‘due date’ reminders weren’t enough, often a prompting on the day is enough to get your clients paying on time.
“On the date that the invoice is due, your automated invoicing service can send an email or text alert to the client, with an easy clickthrough.”
3. Overdue Reminders
On your invoice, it’s imperative that you stipulate the invoicing due date as well as the penalties that apply for late payments. These could include extra charges and interest after a month, two months, or more. If the client missed the due date of the invoice, your automated invoice reminder will then send overdue reminders at selected intervals to encourage swifter payment.
4. Recurring Invoices
Depending on your business, you might very well work with clients on a regular basis such as a subscription service, which requires monthly invoices. It can be tedious and time-consuming to set up invoices and send them each and every month manually, which is where the automated invoice reminder comes in. Certain software has a recurring invoice feature that takes care of this problem.
5. Automatic Debits
If you have a good relationship with your regular customers, then you could also use your automated invoice service to charge their credit card or bank account each month. For some customers, this is an attractive option as they’re not constantly being reminded to make payments, and the hassle is removed. It saves both you and your customer time and trouble.
6. Schedule Invoices
You might find yourself in a situation where you know when a job will be completed and can prepare the invoice ahead of time. If this is the case, you can use your automated invoice reminder to send out the invoice once the project is complete. This allows you to focus on the work at hand without worrying about payments constantly.
With Chaser, the end-to-end accounts receivable software, you can implement automated invoice reminders that encourage on-time payments through personalised reminders. You benefit from sequenced reminders that meet your individual business needs, communicating effectively and politely so that your payments are made and the relationship continues.