How to chase invoices and get paid
You’ve done the work and now it’s time to get paid. The invoice is set up and has been sent over to the client. Payment day arrives but the money doesn’t. So what do you do?
In this article, we’ll take a look at some methods you can use to try and make sure you get paid on time and if not, how you can effectively chase invoices.
Setting up an invoice
The first step to getting paid is to put together an invoice and send it to the client.
A well put together invoice that outlines the amount, payment details and also the expectations around when you should be paid are all steps to ensuring your invoice is paid (and on time).
Want to know more about writing invoices? Check out our Beginner’s guide to invoicing here.
Set expectations early
This is one of the key ways to make sure that invoices are met within the terms agreed.
When agreeing on the cost with the client, you can also set out payment terms that include when you will invoice, how long they have to pay and how long before you may charge interest or late fees.
The government now allows small businesses to charge up to 8% interest plus base rate on late payments. You can also transfer any debt recovery costs to the client.
In the government’s eyes, a payment becomes late 30 days after invoicing or the product or service is delivered, if no prior terms have been agreed.
You can charge whatever late fees you like within the government guidelines, but it’s probably best to make sure your client is aware of these before jumping into a transaction.
A gentle reminder
The agreed payment date outlined on the invoice has come and gone and no payment has been received. About 48 hours after the invoicing date, why not send the client a gentle reminder that payment was due? Ask if there is any delay and if there is anything you can do to help move things along.
Hope you’re well.
The invoice for last month’s classes was due two days ago. I was just checking in to see if everything was okay or if there was going to be any delay in payment?
I’ve re-attached the invoice for reference. Let me know if there is anything I can do to help.
Don’t be too forceful at this stage. You know your clients and how best to speak to them.
7 days after payment was due
The payment was now due 7 days ago, but the invoice has still not been settled. An email was sent 48 hours after the agreed payment date, but that wasn’t enough.
You may want to send another email reminding them of the outstanding amount and explain that the payment is now overdue. It may also help to remind them that after so many days, late fees or interest may kick in.
Just wanted to check in on Invoice #123 and see if there was anything I could do to assist with moving payment along.
The invoice was due 7 days ago and the outstanding cost stands at £257.45.
I’d really appreciate it if you could let me know when I can expect payment or if there are any delays or queries around the invoice.
As per our agreed terms, if payment isn’t met 30 days after the agreed date a 2% interest will be added for each day the payment is late.
The email should be slightly firmer in tone than the previous one, but still not too forceful. You want the client to reach out and explain why a payment may be late or let you know if there are any delays.
Still not been paid? Call the client
If emails don’t seem to be working, it might be best to just try and call them and see if you can have a chat.
We’ve all done it. Left that email in our inbox, unread, because we didn’t want to deal with it straight away and then it gets completely forgotten about. A call is slightly harder to ignore for long periods of time.
A phone call also allows you to talk freely to your client and they might be more inclined to open up about any delays or trouble they’re having making the payment.
Keep chasing the invoice
If payment still isn’t made after all previous attempts, you need to stay on it and chase the invoice on a regular basis. Going quiet and not asking for payment could lead to a longer wait time before receiving payment from the client.
If you manage to make contact with the client and speak to them and payment is promised, make sure you get the new payment date in writing.
If payment still isn’t met 30 or 60 days after the initial agreed payment date, then you might want to consider legal action. As a small business, you have a number of options including small claims court, debt recollection etc.
You can find out more of your legal rights and what your options are on the government’s website.
Invoicing with Mettle
Mettle’s invoicing tools not only allows you to create and send branded invoices on the go but also gives you a view of all outstanding and upcoming payments. You can set up automated reminders so that you don’t have to chase invoices yourself and hopefully receive payment without even thinking about it.
To find out more about Mettle, click here