If you notice that a majority of your invoices have gone uncollected, the answer to your problem may lie internally. If you become more proactive on collections, you may notice a decrease in days waited to receive payment. Start the invoice collection process early, rather than waiting until the due date has arrived. Here are some tips on getting ahead of the game.
SEND OUT INVOICES ON TIME
Don’t wait until a day before the invoice is due to send it out to a customer. Sending out invoices daily or weekly gives the customer enough time to gather up the funds to pay off their debt. A recent study on unpaid invoices shows that 11 percent of customers never even received an invoice. By automating your invoice send-outs, you can guarantee that the customer has seen it, maybe even a few times.
MAKE THE INVOICE CLEAR
If the terms of the invoice are not spelled out exactly the way you expect to receive it, chances are you’re not going to get the results you were looking for. Customers will take the easiest path given to them. About 49 percent of unpaid invoices are a result of missing information on the invoice, so making this clear to the customer will guarantee a shorter wait time on your accounts receivable.
SEND YOUR INVOICES ELECTRONICALLY
Talk you customers into receiving their invoices electronically. Sending invoices via snail mail is guaranteeing a minimum 3 day wait time once it has been sent out. Add to that, the costs of postage and time it takes to get to the post office. Sending an email with a clear subject line that will get your customer to open it will save you time on collecting your payments.
KNOW WHO TO CONTACT
Make sure you’re sending those email invoices to the right person. Waiting for the recipient to forward the email along through multiple channels will incur longer wait times, or may just sit in the wrong inbox without a response. Sending the invoice to the correct person from the get-go will correct any disputes over never receiving the invoice in the first place.
IMPLEMENT AN AUTOMATED ACCOUNTS RECEIVABLE SOFTWARE
Using an accounts receivable software can automate all of the above tips for you. All of your customers account information is easily accessible and emails can be set on a timer to be sent out as often as you want. You can expect to get paid at least 20 percent faster by using an automated accounts receivable software.
By working proactively to ensure you collect on all outstanding invoices you can cut your wait times easily. Whether you’re a small business or generating large revenues, simply staying organized is an easy way to manage your accounts receivable.