How To Ask Your Clients For A Late Payment
Asking for money is never easy. It’s awkward, time-consuming, and you certainly don’t want to upset your clients. But overdue invoices are also dangerous – they risk affecting your cash flow and putting you out of business. Not to mention the fact that you have a right to be paid for the work you’ve done!
But how do you handle such a delicate situation? How do you ensure you get your overdue invoice paid and keep your clients coming back for more?
Whilst there are no silver bullets, there are plenty of steps you can take to help minimise the problem. In this post we’ll look at the best ways to ask clients for late payment. We’ve also made some email scripts and template downloads ready for you to use, should you need them.
Set the tone from the start
Being upfront with your clients about payment can save you hassle further down the line, so it’s best to state your invoicing terms from the off. UK law says that payment must be received “within 30 days of getting your invoice, or the goods or service”, unless agreed otherwise.
But although the default is 30 days, the average payment time for invoices in the UK is currently more than 38 days. So you may well want to start with shorter terms, especially with your new clients. You could even try asking completely new clients to pay their first invoice in full, before doing the work.
There is no right or wrong answer here, just make sure you’re clear about what you expect.
A common mistake many smaller businesses make is to wait until the invoice is overdue before chasing it. That’s already too late! Ideally you should send the first reminder about a week before the due date. Don’t think of this as pushy – it’s more an effective way to get the ball rolling.
In the best case this first reminder may get your invoice paid early. But if not it will certainly help keep it in your customer’s mind, and it may help you to identify any problems with the invoice early on (which could affect payment time).
Send another reminder on the day the invoice is due, and if nothing has happened within a week, send another one after that.
Create an email script for your reminders
As well as the financial aspect, one of the most annoying things about chasing late payment is the amount of time it takes. One way to save time is by having a set of email scripts for your reminders, ready to send out as and when you need them.
Here’s a few suggestions.
1. A Week Before the Due Date
Hi [FIRST NAME],
This is just a quick reminder to let you know that payment for invoice #123, which we sent you on June 26th, will be due in a week’s time, on 3rd of July.
Please take a moment to check the invoice, and do let me know if you have any questions.
2. On the Due Date
Hi [FIRST NAME],
This is just a quick reminder to let you know that payment for invoice #123, which we sent you on June 26th, is due today. Please pay this as soon as possible.
Let me know if you have any questions, happy to help with whatever you need.
3. A Week After the Due Date
Hi [FIRST NAME],
We have not yet received payment for invoice #123. A payment of £ [XXXX] is now overdue.
I’d really appreciate if you could pay this invoice as soon as possible, and please let me know when you have done so.
If you have any questions then let me know.
If that still feels like a lot of work you can use Zervant to automate the whole process, and set up automatic payment reminders.
Give your client a call
If email reminders aren’t getting your invoice paid then you should also try just giving your client a call. Mistakes do happen – maybe the address was wrong, perhaps your emails ended up in a spam folder…
Sometimes all you need is a quick call to find out what is going on, and to get your invoice paid. Plus, if someone is just stringing you along, it’s easier to come up with excuses via email than on a direct phone call. If you’re still stuck then it’s time to consider legal action.
Hopefully these pointers help you get started, but be sure to check our blog for more advice on coping with late payment.