It’s never an easy topic to broach but when it comes to invoice and payment disputes, it is important that you manage issues in a way that ensures you don’t damage business relationships.
Through effective credit control procedures it is possible to prevent payment disputes, so use these six methods to handle these kinds of situations more effectively.
When it comes to payment disputes, you want to avoid wasting time. Therefore, it can help to ensure you keep records and remain organised. You need to ensure that you can access your agreed deliverables and all information relating to billable costs when you need them.
Set Out Your Costs from the Start
Prior to finishing a job and sending an invoice, you need to ensure your client understands what they are getting and what it will cost them. It’s really important to set out these costs to reduce the likelihood of payment disputes. So, if you can have their agreement in writing, if any issues do arise, you have proof that they agreed the amount for your services.
Make Your Terms Clear
You want your clients to pay as soon as possible as this will help with cash flow. So, you need to have a payment policy in place that clearly states when payment should be made and how it should be made. Furthermore, you should also ensure that they are aware of what happens if they fail to make the payment on time.
Keep it Friendly But Firm
You don’t want to give in to your clients if they make an unrealistic request such as using a certain payment method or even paying beyond the deadline. To ensure you do not get angry with your client, you should ensure that you have all documentation to hand as well as the necessary figures to get your point across. You can then respond to them with the hard facts and a reasonable explanation, which is likely to lead to them agreeing to pay. If the mistake was made by you, then you should acknowledge that quickly and provide them with a new invoice. The goal is to maintain your relationship by handling the situation professionally.
Always Seek a Resolution
From a misunderstanding to an error that is the fault of your client, you should aim to come to a natural resolution that keeps you both happy. This is important to bear in mind when it comes to unpaid invoices or payment disputes while you should always aim to keep a record of conversations which means that you should communicate by email.
Use an Accountant
If unpaid invoices are becoming a problem and you are struggling to manage your accounts then it can help to use an accountant. They will deal with chasing payments, implement the right software and ensure that you get paid in full and on time.
Invoice and payment disputes are one of the downsides of running a business. However, handling them the right way will ensure that you both come away from the situation satisfied.