We have ways of making you pay (we wish)

If you run your own business, you surely know (and if you don’t, your accountant will soon tell you) that cash-flow is king. There’s no point having thousands of pounds/euros/dollars in the payment pipeline if your bank account’s empty and you can’t pay your suppliers (or, ultimately, the mortgage).

I work a lot with Italian public sector clients so I know what I’m talking about.*

One of the problems is that you feel powerless. You’ve kept your side of the bargain: you’ve done the work, you’ve submitted your invoice and now your clients are placing you in an untenable position that’s putting your business and reputation at risk. And there’s nothing you can do about it.

Well, maybe there is something you can do. My system is to send out a reminder to clients that an invoice will soon be due for payment, about 5-7 days before the due date. I word it nicely, the degree of formality depending on how well I know the client. If, one week after the due date, they still haven’t paid, I send out a further politely worded reminder, specifying the date by which I’d like the payment to be made.

When the client does pay, I follow up with a brief “thank you” message.

One of my clients used to say that she never paid an invoice until her suppliers reminded her to. And just last week I discovered that an invoice I’d sent to another client in early April hadn’t been recorded at their end, and was only discovered when they received my reminder. They’ve now introduced a new procedure to ensure that my invoices go directly to the right person in accounts.

So it pays to jog your clients’ memory.

Just sitting around complaining about late-paying clients won’t solve any problems. And sending out reminders won’t necessarily speed things up, if your client is determined to hold out until the last possible minute (they’re under cash-flow pressures too). But if you take some initiative, you’ll feel less powerless and more in control. If your client still doesn’t pay on time, at least you’ll know that you’ve acted in a business-like way.

*But a huge thanks to Stefano, who got my 2 May invoice processed and into my bank account in just 18 days!!!

By Marian Dougan

9 Responses

  1. What a great idea! I have honestly not tried the advanced reminder approach yet. Do you have a system that reminds you to remind them too? That is what I am looking for. A system where I can plug in due dates and automatic reminders. Any ideas?

    1. Thanks! I don’t have a system as such. I have a list in Excel of invoices issued, with a column for due dates, which I check pretty regularly. I could probably use the Mac’s iCal reminder system for something a bit more sophisticated. BTW, to calculate the due dates I use Time and Date — my brain’s not up to that challenge!
      Does anyone out there have a good billing system with integrated due-date reminder?

  2. I really like this blog posting because of the proactive approach. To be honest, we have yet to have a customer NOT pay us, but there are often delays. Reminder emails are a good idea because it is always the agency or translator waiting on the payment, the corporation does not usually know they have not yet paid you. If emails don’t work, pick up the phone!! A phone call can almost always easily resolve the situation.

    We had a situation with a government agency in which they were months behind on their invoices and wouldn’t respond to our emails or queries. When we called them, it turns out that all invoices are rejected unless they have the PO # WRITTEN (yes, hand-written) in the right upper hand corner. They didn’t bother to tell us that, of course. We finally got in touch with the right person, faxed them all over, and got a check in three days. Companies often have odd policies, and the translation buyer may not even know the accounting office’s requirements.

    Thank you for the article!

    Grace Bosworth
    President, Global2Local Language Solutions

    1. Thanks for your comment, Grace, and apologies for the delay in publishing – it got caught in the spam for some reason. And I thought my clients were bad — a hand-written purchase order number’s a new one to me!

  3. I too use the 7-days-before-it’s-due-friendly-reminder-email with those clients that need a bouquet of forget-me-nots. And it works well.

    Good business communication also means asking what a client’s accounts payable schedule is so you can adjust sending your invoice as well as friendly reminder in the most constructive way.

    How to remember when to send that important email? I just put a task reminder with alarm in my Sunbird calendar at the same time as I send out the invoice 🙂

    1. Great advice — thanks, Patricia. Especially about communication with client and asking about their accounts payable schedule. We all too often forget that clients have their problems too and are often under pressure. I hadn’t heard of Sunbird before — are you happy with it?

      1. Sunbird is the calendar plug-in for Mozilla’s Thunderbird and I’m delighted with both.

        I got fed up with repeated crashes in Outlook and its archive system. Switched to Thunderbird two years ago, and haven’t looked back since.

        And now, there are some good third-party apps that enable synchronizing Thunderbird with various smartphone OS too.

        1. Yes, I got pretty fed up with Entourage, the Mac’s version of Outlook. I lost a lot of data on more than one occasion (in spite of the back-ups). The funny thing was, after the initial shock, it was business as usual – I pieced together my contacts again and survived without the lost emails. I’m now using the Mac’s Mail, Address Book and iCal.

  4. I once did a project for Yamaha- when it was completed I handed the invoice to the Director concerned- he opened his desk, took out a cheque book and wrote me a cheque. I immediately said: “I’m sorry but you clearly do not understand business – you are a large company – I am a freelance- therefore you take the invoice, forget about it, then refuse to accept my calls when I begin to get anxious after three months of ‘non-payment’ Finally you begrudgingly send me a cheque with my name mis-spelled, together with a curt message implying that this sort of behaviour is unlikely to result in repeat business.” He smiled at me, not entirely sure whether I was joking or not- and said ‘This is how it works in Japan.’


Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.


Recent Posts