{"id":7145,"date":"2020-09-11T13:32:58","date_gmt":"2020-09-11T17:32:58","guid":{"rendered":"https:\/\/www.sage.com\/en-ca\/blog\/?p=7145"},"modified":"2025-08-05T09:29:46","modified_gmt":"2025-08-05T13:29:46","slug":"7-important-steps-to-combat-unpaid-invoices-and-get-paid","status":"publish","type":"post","link":"https:\/\/www.sage.com\/en-ca\/blog\/7-important-steps-to-combat-unpaid-invoices-and-get-paid\/","title":{"rendered":"7 important steps to combat unpaid invoices and get paid"},"content":{"rendered":"
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\n\t\t\t\t\t\t\tMoney Matters<\/a>\t\t\t\t\t\t<\/div>\n\t\t\t\t\n\t\t\t\t
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\n\t\t\t\t\t\t7 important steps to combat unpaid invoices and get paid\t\t\t\t\t<\/h1>\n\t\t\t\t<\/div>\n\n\t\t\t\t\t\t\t\t\t

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\n\t\t\t\n\t\t\t\t\"Keir\t\t\t\tKeir Thomas-Bryant<\/span>\n\t\t\t<\/a>\n\n\t\t\t\t\t<\/div>\n\n\t\t\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t<\/div>\n<\/div>\n\n\n\n\n\n

Collecting on unpaid invoices can be a daunting task. It can be nerve-wracking trying to approach the conversation firmly enough to get you paid but delicately to not damage the customer relationship.<\/span><\/p>\n\n\n\n

\u201cAt the end of the day you\u2019re owed money,\u201d says Paul Donno, chartered accountant and director of Accounts Online. \u201cThey’ve received your service or your product. If they’re happy and there’s no dispute, then there’s no reason why they shouldn’t pay you.<\/span><\/p>\n\n\n\n

\u201cHere\u2019s how I think about it. You don’t go into a supermarket and say, \u2018I’m taking this trolley full of food, and I might just pay you in a couple of months’ time.\u2019 So why should it be this way for a small business?\u201d<\/span><\/p>\n\n\n\n

However, the necessity to take drastic measures are rare.<\/span><\/p>\n\n\n\n

Here are seven easy tips to speed up getting money for those unpaid invoices.<\/span><\/p>\n\n\n\n

1. Ensure the invoice has all the relevant information<\/span><\/h2>\n\n\n\n

\u201cIt is possible to have too much information on an invoice,\u201d says Donno. \u201cBut you also need to ensure you have the right amount of info.\u201d<\/span><\/p>\n\n\n\n

This includes the VAT number if you\u2019re registered, correct prices, quantity and description, payment terms and obviously the supplier and customer\u2019s full names and addresses.<\/span><\/p>\n\n\n\n

\u201cIf your customer requires a purchase order number, or a reference, make sure that goes on as well,\u201d adds Donno. \u201cAnd make sure everything adds up.\u201d<\/span><\/p>\n\n\n\n

Stay on top of details means your client has fewer reasons to come back to you with questions \u2013 and fewer reasons to delay payment.<\/span><\/p>\n\n\n\n

2. Put your full bank details on all invoices and statements<\/span><\/h2>\n\n\n\n

\u201cBe very, very, very clear how you want to get paid!\u201d says Donno. <\/span><\/p>\n\n\n\n

Include details on the invoice like your international bank account number (IBAN) and the bank identifier code (BIC). If you have other payment options or methods available, put those on the paperwork, too, such as via PayPal (give email address), over the phone by credit card, and so on.<\/span><\/p>\n\n\n\n

\u201cI personally wouldn’t provide the option of sending a cheque,\u201d says Donno. \u201cThey\u2019re horrendous to deal with in terms of banking in our modern age, and expensive too.\u201d<\/span><\/p>\n\n\n\n

Try to make it as simple as possible for your customers to make a payment. If someone has to stop the payment process to hunt for bank details, they are less likely to make the payment.<\/span><\/p>\n\n\n\n

\u201cWith modern software you can have a button on your invoice for payment,\u201d continues Donno. \u201cThis goes straight to your credit card supplier, such as Stripe or GoCardless. Customers can then pay straight away . It really does make it simple!<\/span><\/p>\n\n\n\n

\u201cSet out terms for your invoices early in the relationship. Ensure you agree something that suits your business model.\u201d<\/span><\/p>\n\n\n\n

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Free Interactive Guide: Manage your cashflow and keep customers happy<\/h2>\n\n\t\t\t\t\t\t\t\t\t
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Learn how to stay on top of your cash, get your invoices paid all without sacrificing your customer service<\/p>\n\t\t\t\t\t<\/div>\n\t\t\t\t\n\t\t\t\t\t\t\t\t\t\t\t\t\t\tAccess the interactive guide<\/a>\n\t\t\t\t\t\t\t<\/div>\n\n\t\t\t\t\t<\/div>\n\n\t\t\t\t\t\"Woman\t\t\t<\/div>\n<\/div>\n\n\n\n

3. Pick up the phone and speak to your customers early<\/span><\/h2>\n\n\n\n

For larger invoices, give a courtesy call a week after you\u2019ve sent the invoice to make sure it has been received and there aren\u2019t any discrepancies. All sales invoices matter and should be paid on time but the larger ones should be treated with a personal touch.<\/span><\/p>\n\n\n\n

\u201cIs it possible to speak to customers too much?\u201d says Donno. \u201cNot if they owe you money! Find the person responsible for paying invoices. If you’re regularly invoicing them, you\u2019re going to build a good rapport. They know that you’re going to be chasing it. And after a while, they will know what you expect \u2013 and this can enforce regular payments.\u201d <\/span><\/p>\n\n\n\n

If you wait until the invoice becomes overdue to make a call, only to find out it wasn\u2019t received or there was an error on it, then it could put payment back another month as it may have missed the payment run. <\/span><\/p>\n\n\n\n

Don\u2019t expect the customer to contact you to say there is a mistake or ask for their invoice \u2013 this rarely happens.<\/span><\/p>\n\n\n\n

4. Keep a journal of all calls and responses<\/span><\/h2>\n\n\n\n

Accounting software isn\u2019t just about the numbers. You can keep a note of when you contacted clients to chase invoices, and record what their responses. <\/span><\/p>\n\n\n\n

Donno adds: \u201cIf someone says, \u2018I didn’t promise to do that,\u2019 then you say, actually on this day and this time, you said you were going to send me payment \u2013 and I’ve not received it. Also, make sure you’ve got alerts on your diary system to remind you when it\u2019s best to chase them.\u201d<\/span><\/p>\n\n\n\n

When making notes, include at a minimum the date, time, who you spoke to. Of course, try to record as verbatim as possible and what their response was \u2013 especially for that first courtesy call chasing a payment.<\/span><\/p>\n\n\n\n

If the person you contact knows you are keeping tabs, they are less likely to shirk in their duty to pay. Often in businesses there\u2019s a secret pecking order of who gets paid promptly. By proving yourself a formidable force when it comes to chasing invoices and being able to strengthen your position by quoting previous conversations, you\u2019re pushing yourself up that list. <\/span><\/p>\n\n\n\n

5. Get the date right<\/span><\/h2>\n\n\n\n

There\u2019s a handful of tricks around invoice dating, which are explained below. <\/span><\/p>\n\n\n\n

But a general rule, says Donno, is to \u201cinvoice straight away. Don\u2019t leave invoicing until the end of the month if you can help it.\u201d<\/span><\/p>\n\n\n\n

Good advice is never to invoice on the first of the month. Date the invoice on the last day of the previous month because this makes the invoice fall into the previous month\u2019s accounting for your creditor. For companies that run their payments net 30 days (ie, payment is 30 days after the end of the month of the invoice date) this will bring forward your payment by a month most of the time.<\/span><\/p>\n\n\n\n

For example, an invoice dated 1 April will be paid at the end of May; however, an invoice dated 31 March will be paid at the end of April. Your payment terms may be 30 days but the majority of companies would just slot it into their net 30-days routine.<\/span> In most invoicing software<\/a> setups, you can automate customised send out dates for each client.<\/p>\n\n\n\n

It is essential to establish payment terms up front. Some are set in stone and could even be 60 days net, which could mean you don\u2019t get paid for 90 days after the invoice date. This is why this is important.<\/span><\/p>\n\n\n\n

6. Amend your invoice issue date \u2013 part 2<\/span><\/h2>\n\n\n\n

Another trick with the date being one day different is if you make a statement run at the end of every month, ensure it\u2019s dated for the first of the following month. This will make the invoice appear older than it actually is.<\/span><\/p>\n\n\n\n

How much you benefit from this depends on how your statement reports are structured. Either way, make sure you send monthly statements as some companies will only pay on statements.<\/span><\/p>\n\n\n\n

Dates are important on invoices. Ensure you know enough about the way your creditor works to use the right approach. <\/span><\/p>\n\n\n\n

7. Consider invoice factoring<\/span><\/h2>\n\n\n\n

Wouldn\u2019t it be great if you could hand over your invoice to somebody else and let them chase it? This is what invoice factoring companies provide, although you have to pay a percentage of the total invoice cost \u2013 and you\u2019ll need to have good accounting and credit records to be able to sign-up for factoring. <\/span><\/p>\n\n\n\n

But care needs to be taken, says Donno: \u201cA lot of people believe the factoring companies chase the debt. Only the business can chase the debt properly. I’ve seen a lot businesses not chase the debt and then hand the debt to the factoring company You’ve got to really understand what the product is and ensure it’s right for you.\u2019<\/span><\/p>\n\n\n\n

Say goodbye to unpaid invoices<\/span><\/h2>\n\n\n\n

Technology such as e-invoicing and automation virtually eliminates the common factors that cause late payments.<\/span><\/p>\n\n\n\n

Having an invoice payments functionality within the accounting software you use will help to resolve frustrations with payments admin and will make the payments process easier for your customer, meaning payments become much faster within your business \u2013 as a result, you will get paid faster.<\/span><\/p>\n\n\n\n

Acces the free interactive guide in the box below.<\/p>\n\n\n\n

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Free Interactive Guide: Manage your cashflow and keep customers happy<\/h2>\n\n\t\t\t\t\t\t\t\t\t
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Learn how to stay on top of your cash, get your invoices paid all without sacrificing your customer service<\/p>\n\t\t\t\t\t<\/div>\n\t\t\t\t\n\t\t\t\t\t\t\t\t\t\t\t\t\t\tAccess the interactive guide<\/a>\n\t\t\t\t\t\t\t<\/div>\n\n\t\t\t\t\t<\/div>\n\n\t\t\t\t\t\"Woman\t\t\t<\/div>\n<\/div>\n\n

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Browse more topics from this article<\/h3>\n\t\t\t<\/div>\n\t\t\t
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