It may sound a bit odd, but as an entrepreneur, you significantly influence your customers’ payment behaviour. When you implement a strict debtor policy, customers pay considerably faster than when you have a ‘lenient’ policy. Many entrepreneurs think that a strict debtor policy jeopardizes their relationship with their customer. Payt provides you with tips on how to manage and collect your outstanding invoices quickly in a customer-friendly manner.
1. Invoice Digitally
Almost 50% of SMEs do not get their invoices paid on time. One of the biggest improvements they can make is to invoice digitally. Paper invoices simply do not fit into the routine of people and businesses in a digital age. It’s too cumbersome; a paper invoice arrives by post (which takes a day – or longer if you’re unlucky), ends up in a pile to be scanned at some point, and then entered into the payment program. Scanning is an extra step that can easily be postponed for a few days – if the invoice isn’t forgotten altogether. Sending digitally is an absolute must for entrepreneurs in a digital age.
2. Offer Payment Discounts
“Pay within x weeks of the invoice date and receive x% payment discount.” Payment discounts are becoming more common, and for good reason. They work excellently. You reward your customers’ good payment behaviour, and they only need to perform a very simple action: book quickly. The benefit works both ways. By paying quickly, a party incurs less interest loss. That advantage, plus the time and costs associated with sending reminders, absolutely outweighs the costs you incur.
3. Implement Strict Debtor Management
However, the very best way to get invoices paid quickly is simply to have strict debtor management. This means applying and enforcing a clear payment term. If your payment term is 14 days and your customer has not paid after this period, send a payment reminder immediately on the fifteenth day after the invoice date. Some companies only pay after a first reminder, so don’t make your payment term too long. Clearly indicate in your reminder that it is a reminder. After all, the invoice may have escaped the customer’s attention.
After the first reminder, you can choose to send a second reminder or proceed directly to a demand. Most people find it too early for a demand and therefore opt for a second reminder, which is a bit stricter in tone. Send the second reminder no later than two weeks after the first reminder and demand payment within five working days. If your customer still hasn’t paid after the second reminder, you can easily start a collection process. The great advantage of strict debtor management is that you show you are on top of it and the invoice will not escape your attention.
4. Automate Your Debtor Management and Collection Process
If you choose to automate your debtor management, your invoices and reminders are automatically sent. Since Payt integrates with more than 650 different accounting packages, the software seamlessly connects to your existing accounting package. Moreover, you can set all preferences regarding your debtor management yourself. This way you can:
- decide yourself after how many weeks you want to send a reminder. The software checks whether the payment has been made during that period. If not, a first and – if necessary – a second reminder is automatically sent.
- easily communicate about (outstanding) invoices via the Payt platform. The payment reminders contain a link that allows your customer to pay the outstanding amount directly via, for example, iDEAL.
- pause or stop the process per customer in the interim. Has the customer contacted you or is there another reason why you don’t want to continue sending reminders? Then you can pause or stop the debtor process with the push of a button.
- easily and quickly record and monitor payment arrangements.
And if a customer still hasn’t paid after the reminder cycle? Payt automatically starts an amicable collection process, without the intervention of a collection agency. Start improving your debtor management today!