5 tips on payment terms
Every invoice you send or receive must include a payment term - the time you get or give to pay the invoice. The most common period is 14 days, but some companies give a longer period of 30 days or more. In any case, the payment term is an important aspect of your company's financial health. We give you 5 tips on how to deal with it below.
Make sure the payment term is reasonable.
But what is reasonable? 14 or 30 days is common practice. Think carefully about this, most customers will only pay on the due date. A longer payment term therefore reduces your liquidity. Always make sure that this term is included in the general terms and conditions your customer accepts when ordering your products and services. This way, you avoid any debate.
Send a reminder in time
If you don't get paid within the time limit, you have to chase your money as soon as possible. Of course, your client may have forgotten to make a payment. In that case you send him a reminder. When a client systematically "forgets" to pay, then a more resolute approach is required.
No matter how annoying late payment is, try to keep calm and stay friendly. Especially with a first reminder. Has there been no response? Then your tone may become more compelling. With hard as leather customers, a more compelling tone is allowed with the first reminder. Feel free to refer immediately to the extra costs that are mentioned in your general terms and conditions.
Call your customer in case of late payment
Is a customer still not paying after your reminder? Call him and explain clearly what the next steps will be and the consequences. Clearly state your ultimate deadline and be consistent. There is no point in threatening certain steps if you are not prepared to take them. Bad payers are quick to realise this. Always confirm any agreements made by telephone by e-mail.
Bring on Unpaid.
Is your customer, despite your efforts, still not paying? Are you tired of e-mailing and calling at this stage? Then bring on Unpaid. We will immediately set to work to enforce payment via our online platform.