For any business, ensuring prompt payment is essential to business success. In tough economic climates many businesses have to face being paid late, but it doesn’t have to be that way. A cloud accounting system like Xero can help ensure your business is paid promptly. To get your payments flowing in, follow these top payment tips:
You can’t receive a payment unless your client has been invoiced. So your priority is to ensure your invoice lands on their desk in time for their next pay run. With a cloud accounting system, you can immediately invoice as soon as the goods or services are delivered. Even if you are not in the office, you can send off invoices from your phone.
Establish payment terms with your clients before taking on their work. In the past, clients used to get weeks to pay but this is no longer the norm. More than a third of businesses request payment within a week of service or goods delivery.
Many businesses offer prompt payment discounts. If a client pays on time, they get 10% off the cost of the goods or services. Alternatively, you can charge for late payments. However, the lure of saving money is a more powerful motivator and prompt payment discounts are more effective.
If your clients can pay you easily, your chances of a prompt payment are a lot higher. Cloud accounting systems like Xero offer only online payment services and research shows that in the US, the businesses that use this get paid 50% faster than those that don’t. Xero also integrates with popular payment methods like Paypal, facilitating easy international payments.
If you haven’t received payment within a week, send out a payment reminder. If you are using a cloud accounting system, you can set up all your invoices online and immediately see which invoices have been paid and those that are still awaiting payment. You can then automate your accounting software to ensure that a reminder email is sent to your client automatically the invoice goes past the due date.
Speed up payments with Xero
Xero is a cloud accounting solution designed to speed up your payments. As a Xero Gold Partner, the GG Group can help you simplify the entire invoicing process and ensure your payments happen faster. For more information, contact the GG Group to see how Xero can be tailored to your business.