Occasionally we all struggle with overdue invoices - so how can we best deal with this?
- Assess customers’ creditworthiness and set appropriate credit limits.
- Ensure clear terms and conditions including payment terms.
- Make sure the invoice recipient and address are correct. Try and stick to a single contact, shared responsibility can be problematic.
- Send invoices promptly and timely. Chase payments as soon as they are due.
- Establish whether client has a regular payment system or a monthly cheque run. Consider adjusting invoicing to reflect this.
- Phone your client when an invoice payment becomes overdue. E-mails and letters tend to be ignored. Go for the personal and diplomatic approach, particularly when you want to have a continuing relationship with the customer.
- Resolve any disputes quickly, you are unlikely to be paid until this is done.
- Reconsider the terms on which you do business with customers that regularly pay late, do you still want to continue with them as a client?
- Have a strategy in case the debt is not paid. Writing off small debt, ceasing output until monies are paid or negotiating part or revised stage payments.
- Use legal advisers if your attempts to recover the debt are unsuccessful. A courteous legal letter may be enough to encourage prompt payment without any further action.
