When entrepreneurs and business executives plan their sales and services, they likely imagine new, exciting products to offer existing and potential customers. They imagine scaling up with incoming revenue, rave reviews, and a healthy bottom line. But what happens when your award-winning goods aren’t paid for by the clients who receive them?
When your sent invoices are met with silence, what should you do? Before moving to an advanced option outside of your company, try these methods to collect on your unpaid invoices.
4 Tips – How to Collect Unpaid Invoices
1. Send a second invoice with a late fee. Ensure your contracts state late fees for lack of payment with concrete terms.
2. Make a phone call. Who in your company has a trusted relationship with the debtor? Consider your billing department, salesperson, account manager, or even your company’s owner. You have likely spent hours developing a relationship of trust and rapport that can be leveraged into these difficult situations
3. Consider accepting a new term of payment. Can you take half now and the rest next month? Can you barter services in return if a B2B? Are there upcoming contracts and plans that can be delayed until this service is paid?
4. Send a co-branded demand letter. Work with a debt collection agency to have them send a letter with both company’s letterhead, stating the collection agency will be engaged if there is a lack of payment.
Working through these steps before sending your past-due customers to a debt collection agency may result in a heathy account.
For more advice or assistance with past-due accounts, or how to collect unpaid invoices, we’d be happy to chat with you! Contact us.
To learn more about setting the stage to have less past due accounts in the future, read our blog titled “How Can I Ensure My Customers Will Pay Upon Invoice.”