A complaint common from many small-business owners is the never-ending chasing of overdue invoices. Research shows nearly one-third of Australian business owners spend eight hours a week collecting late payments.
So, how do you best approach overdue invoices?
1. Optimise your systems
The best way to avoid overdue invoices is to prevent them from happening in the first place. From the beginning make sure you’re clear about your payment expectations and understand your client’s usual pay cycle. This is the opportunity to negotiate mutually suitable terms that work for both sides.
Consider implementing an online accounting system which includes e-invoicing. Electronic invoices ensure an accurate record is kept and that the recipient has all the required information to make their payment instantly. It also gives you the ability to configure automatic reminders as soon as the invoice is due or late for payment.