late payments

5 Ways to Handle Late Payments in Your Company

Do you need to phone or contact a client that owes you money? It’s awkward, we know. Remember that this isn’t personal- it’s business.

Chasing late payments can be a tricky situation to navigate. Being able to hold your professional attitude and still be polite yet assertive is a skill that we will help you to cultivate with this concise guide. Take a look at our 5 tips to help you handle late payments in your company.

Change Your Attitude

The number one challenge some businesses face is thinking that they are being rude when they are following up on some late payments. As we have already said, this is not personal- it’s business! And if a client owes you money for services rendered, then your company is entitled to ask for that money. Those who need a business loan generally know that they need to pay the money back within a specific time frame, and will already expect you or your company to come knocking if they are late on payments.

Communicate the Terms Early

Before any client is even in a position to owe money, you should communicate loud and clear exactly how and when money should be paid for any services. This avoids any ‘nasty surprises for the client and then the client already knows upfront the expectations. 

 If you are a new company and are unsure how to set the terms, you can request money upfront or ask for a deposit (at least). You could even request that all new clients pay upfront before rendering any services.

Set-Up Interest Charges for Late Payments

Setting up an interest charge for late payments can inspire your clients to be on time for their payments. However, it is important that your clients are well aware of this late interest charge beforehand.

Draft Email Scripts

Draft an email script that you can send out as a first reminder. Take the time to create this email draft as a friendly reminder, and keep it as polite yet assertive as possible. You can also place a reminder in the email that a late charge will be added if the payment is not made within a certain time.

Make a Phone Call

If you are still waiting for payment, even after having sent numerous emails, then it may be time to make a phone call. Calling your client can be the right nudge that they need in order for them to make a payment. If you do not like the idea of calling yourself, then get an assistant to do it for you. Having an assistant to chase after late payments can give you more authority in the eyes of your client and can give an extra edge when asking for money owed.

The most important thing to remember when you are chasing down late payments is that you are not being rude, and that business is business. Maintaining an assertive yet polite demeanor can be tricky. That’s why it is important to take the time to prepare emails beforehand. Have a plan ready for these types of situations can save you time and effectively deal with these situations.

You may also like...