Sooner or later, every business gets stiffed. You deliver outstanding products or services to a client, and they fail to pay on time. Dealing with late payments may be painful, but it is also a critical management task. Here are 4 ways to deal with late payments, and minimize the impact they have on your company.
One of the best ways to deal with late payments is to contact your clients directly. Call, email or text them to let them know their accounts are overdue and determine when they are going to make a payment. In some cases, a client may have simply forgotten to pay you, and a courtesy call can help jog their memory.
Use New Tech Tools
If your company isn’t using new tools to assist with payment management, consider investing in them now. Many of these tools can help you track payments due more effectively than you ever could alone. VerifiaBill is a great example of these new tech services. Our invoice auditing and consolidation services can help you gain greater situational awareness over payments due, and mitigate the impact of late payments.
Let it Go
Sometimes you determine that a client simply isn’t going to pay you. If that’s the case, do a quick analysis: how much will it cost to pursue the overdue payment? In many instances, it simply is not worth pursuing further action against a deadbeat client; it may even cost you more money to chase the money you are already owed. If that’s the case, cut the client away and ensure you never do business with them again. And focus on the good clients who are paying you on time.
Get Outside Help
If you’ve exhausted all options but absolutely need a client to pay you for services rendered, consider getting outside help. A lawyer can help you draft a formal letter to demand payment; in a worst-case scenario, your legal team can represent you in court. Collection service companies can also assist with getting deadbeat clients to pay up as well.
If late payments have you down, you’re not alone. Every single business has to deal with deadbeat clients from time to time. But don’t fret. Follow these tips, and start mitigating the pain that late payments are causing your company right away.