How To Deal With Unpaid Client Invoices

Small businesses and freelancers around the world need to be reassured that they’re going to be paid in exchange for their goods or services, yet many professionals still struggle with the occasional unpaid invoice. Navigating the process of getting your valued clients to pay an ignored invoice can be tumultuous and dangerous if you don’t know what you’re doing, so it’s worthwhile to brush up on some common strategies for getting paid when you’ve been given the cold shoulder.

Here’s how to deal with unpaid client invoices, and how to go about finding expert help if you really need it.

Don’t jump to conclusions

The first thing that needs to be established is that it’s very important you avoid jumping to conclusions. It’s easy to get furious when someone doesn’t immediately pay an invoice, especially because no one wants to stare at an empty bank account or rapidly draining capital reserve. Nonetheless, accidents and simple mistakes happen, and you need to realize that going nuclear from the get-go is a surefire way to burn your bridges while establishing a nasty reputation for yourself in your industry. Thus, you should begin by taking the polite-yet-firm route.

Never allow yourself to be a pushover who clients can ignore at no cost but realize that you need to be polite and understanding in the event that there’s been a small mishap that will briefly delay the paying of an invoice. Have an established follow-up procedure where you can politely reach out to your clients (ideally in as personalized a fashion as possible, like a phone call) before moving on to more extreme measures.

You should also strive to set clear expectations from the very start of your relationship with your clients. Having a simple contract prior to the commencement of your business relationship can make things easier, for instance, as having everything down in black and white ensures that everyone is clear on the agreed terms of your work and is legally bound to their financial commitment. By relying on contracts, freelancers and small businesses everywhere often drastically cut down on the amount of times they have to chase clients over unpaid invoices.

Unpaid invoices were a $825 billion problem in 2017, however, which should indicate that this is no small issue that can be perpetually brushed under the rug. Sooner or later, your clients need to respond, and sometimes you’ll need to push them in the right direction in order to get paid what you’re owed.

Consider escrow options

By relying on sites that utilize escrow options, you can mitigate the overall danger of unpaid invoices. Popular freelance services like Upwork offer payment protection services where clients initially put a deposit in a third-party account, where it’s automatically transferred to you upon the completion of your business arrangement. Escrow options are essentially a form of upfront payment familiar to a realtor Hamilton, so consider relying on this strategy if you’re consistently grappling with clients unwilling to foot the bill.

It’s simply common sense that having legal expertise on hand is also a surefire way to get clients to pony up what’s owed. Nobody wants to come in swinging with a lawyer, but when your business or freelance service is owed money you sometimes can’t take no for an answer. Furthermore, you’re legally entitled to defend yourself in the event you’ve been robbed, so never feel guilty about considering your legal options if you’ve been stiffed. Never allow yourself to stray from a polite, professional approach, however, as this will help you maintain a positive reputation while also proving to clients that they can work with you again in the future.

Of course, it’s better to avoid legal options unless they’re absolutely necessary, so dealing with unpaid client invoices should be managed ahead of time rather than post-hoc. You should consider emailing your clients ahead of the billing period, for instance, just so you can re-confirm the agreed-upon details and politely remind them that they have a payment due sometime soon. Sometimes freelancers and small business owners struggle with establishing a polite yet firm tone in their writing, so if you’re having difficulties determining what to say and how to say it consider reviewing some email scripts.

Never forget that accusatory statements can damage your case, and that there may be good reasons your clients haven’t unpaid you. Nevertheless, refuse to take “no” for an answer when you’re entitled to compensation, and stick to your guns if your clients try to intimidate or demean you or the work you’ve provided to them. Freelancing professionals and small business owners need grit and determination to make it big, but you don’t have to become an angry monster just to get what you’re owed. Stand by your principles, establish clear terms in your contracts, and remain polite yet firm with your clients and you’ll have your unpaid invoice problem resolved in no time.

from Feedster https://www.feedster.com/accounting-and-payroll/how-to-deal-with-unpaid-client-invoices/