Have you ever had a client leave you high and dry when it was time to pay up?
Don’t worry: it happens to the best of us.
Fortunately, collecting payment from clients who go ghost on you doesn’t have to be a hassle.
Business owners have two options when it comes to dealing with unanswered invoices: the “good cop” or “bad cop” approach.
Most of the time you can play the role of good cop by putting some firm-but-friendly pressure on your clients without burning any bridges.
However, there are also some instances where you’ll have no choice but to put your foot down and play bad cop.
So, what’s the best way to make sure you get paid each and every time?
The Good Cop Approach
Playing good cop means taking a positive but proactive approach to pursuing payment. While getting paid is certainly a serious matter, aggressively going after your clients when they miss an invoice will only sour your professional relationships.
Follow-up emails are obviously your go-to option for requesting payment from clients who seem to have disappeared. These emails should be crafted as friendly reminders rather than ransom notes.
For all you know, maybe your invoice somehow landed in the spam folder or got lost in the shuffle of your client’s’ inbox. Better safe than sorry, right?
Here’s a simple “good cop” template you can use yourself to follow-up with clients:
Hope everything is going well. I just wanted to check in to make sure that you received my previous invoice for [date]. I hadn’t heard from you and wanted to make sure there weren’t any issues on my end.
If you need anything else from me, please let me know. Thanks for your time!
If you get no response from your initial contact, don’t panic. After all, your clients are only human and may take a day or two to get back to someone. Although you may be in a rush to get paid, you shouldn’t automatically assume the worst of your clients.
A second follow-up email is totally appropriate if you still haven’t heard back after three business days. Be firm yet maintain a positive tone:
Just following up again on the previously noted invoice: I tried getting in touch a few days ago and still haven’t heard back from you.
As per our agreement, invoices are expected to be paid within [x] days. Please let me know if there are any issues and when I should expect to receive payment.
If you still hear nothing after a day or two, it might be worthwhile to contact your client via phone call or Skype. Since these channels are a bit more direct, it’s more difficult for clients to miss your attempts at communication. Although it may not be professional to contact a client via Twitter or Facebook, you can also check out those channels to see if your client has indeed been active recently.
A “final” friendly notice via email or text message may look something like this:
Please contact me immediately regarding my previous invoice.
These “good cop” steps should be your first course of action; however, you may run into a situation where you have to twist your client’s arm a bit.
The Bad Cop Approach
Don’t mistake the “bad cop” approach with being needlessly rude. Aggressive threats and rants may seem like a surefire way to get a response, but they’re likewise a surefire way to ruin your reputation and lose clients.
If you’ve lost your patience or reach the breaking point where you’re willing to cut a client loose, you have a few options to encourage your clients to pay up.
For example, if you’ve reached out multiple times, you can use an excessively late payment as grounds to end your relationship. When crafting this type of follow-up, try to make your message personal without totally shaming your client. For example:
I am reaching out once again regarding your unpaid invoice for [date]. This payment is over [x] days late which is quite frankly unacceptable.
I respect the time and patronage of my clients and expect the same sort of respect in return. If I do not receive payment within [x] days, I will have no choice but to terminate our professional relationship.
Please contact me as soon as possible regarding this matter.
Writing out these sorts of messages might be nerve-racking, but think about it: is it really fair for you to chase down clients for payments? Sometimes it’s worth your time, energy and sanity to sever with problem clients.
Note that another option you can take if you’re willing to lose a client is to charge an additional fee (15%, for example) for excessively late invoices. Bear in mind that there’s some legalese involved with late fees if they aren’t explicitly in your contract, business agreement or payment policy. Either way, it’s something you can consider including in future client communication.
Obviously, your “last resort” is lawyering up or going after your client in small claims court.
Unfortunately, the headache and legwork involved with taking clients to court can be pretty discouraging. If you suspect that your client is intentionally avoiding you or cannot realistically pay, tracking them down legally might not be worth it in the long-run. Unless you’re out thousands of dollars, you’re likely better off cutting your losses and moving on.
Perhaps the most proactive action to take in the face of problem clients is to figure out exactly how to avoid these payment pitfalls once and for all.
How to Avoid Late Payment Headaches in the Future
Thankfully, there are plenty of steps you can take to avoid late payments in the future.
Firstly, consider asking for payments upfront rather than after the fact. Many clients will be happy to do so – if you ask them to.
If you’re using a business management app like vCita, you have the option to suggest that clients pay during booking to ensure that you get paid 100% of the time. Leading tax professional, Nayo Carter-Gray, explains how asking clients to pay upfront for her services has helped her build her business from the grounds up:
“My online scheduling platform, vCita, integrates directly with Stripe, my credit card payment processor, to accept payment before an appointment can be scheduled. Not only does this integration automate my business as I don’t have to manually collect payments, but it also attracts the type of clients that are serious and not afraid to spend money. After all, since they have to use their credit cards to secure spots on my calendar, I know that they mean business. These clients are more likely to become repeat and long-term business because I provide a mutual level of convenience that makes life easier for both of us”.
You can also use vCita to set up client policies that detail when and how invoices are paid. By asking clients to agree to your own personal terms of service beforehand, you give yourself an extra layer of protection.
Note: this feature can be found through your account via Settings → Online Booking Options → Terms of Service.
Finally, consider that the more efficient your invoicing process is, the less likely your clients are to misplace or potentially flake out on your payments. vCita allows businesses to track payments and understand at a glance if they have pending or overdue payments or invoices. By keeping you up-to-date with notifications and reminders about your payment status, you don’t have to second guess whether or not it’s time for clients to pay up.
Note: this feature can be found through your account via Settings → Payments, which allows you to filter invoices by “paid,” “pending” or “overdue.”
With vCita, You’ll Never Miss a Payment Again
The best way to make sure that you get paid on time every time is knowing how to effectively approach your clients for overdue payments. Having a collection strategy combined with vCita’s easy online payments and invoicing solution ultimately allows you to streamline your payment process and focus on getting down to business.
Any payment nightmares you’ve had to deal in the past? Creative ways you managed to get paid? Let us know in the comments below!