Introduction to payment reminders
Every business owner has encountered a scenario in which they have provided a service to a client and it is now the client's turn to pay. What happens, though, if the deadline passes but the payment remains elusive? This is where knowing the proper way to remind someone to pay becomes important.
Moreover, late payments not only affect your business personally. According to a Quickbooks survey, more than 89% of business owners think that late payments are the main reason why their company hasn't grown yet. We are sure you don't want this to be a reason for YOUR business to not grow, right?
Well, you're in luck because today, that is why in this article, we'll delve into why reminding someone to pay is essential and how you can master this skill effectively and get results.
Why Reminding Someone to Pay is Crucial?
Reminding yourself to pay is more than just getting your money; it's also essential for maintaining stable finances and maintaining healthy relationships. Let us see some reasons why it matters.
Financial Responsibility: When you remind someone to pay, you're not just seeking to collect what's rightfully yours but also encouraging financial responsibility.
Avoiding Late Fees and Penalties: A Win-Win: Late payments often come with unwelcome companions—late fees, interest charges, or penalties. Reminding someone to pay helps them avoid these additional costs, which can pile up over time. It's a win-win situation: they save money, and you receive your payment promptly.
Upholding Your Professional Reputation: In the business world, your professional reputation is priceless. Consistently reminding clients or customers about overdue payments demonstrates professionalism and reliability. Through such communication, a long-term business relationship can be formed, and future collaborations can be forged.
Managing Cash Flow: Managing business finances successfully requires regular reminders to keep a steady income stream, which covers expenses, invests in growth, and keeps your business solvent. It's the foundation upon which businesses thrive.
5 Steps on How To Remind Someone To Pay You:
- Timing is Everything: Picking the Optimal Moment
The first decision to make is whether to send a reminder early or wait until the last minute. While sending reminders well in advance of the due date can be proactive, it might come across as overly eager. It is a two-edged sword, so striking a balance is extremely important.
There are times of the year when finances can be more burdensome than others for your clients. So ask yourself these questions before pushing for reminders. Are they experiencing financial difficulties? Are they typically forgetful? Are they meticulous with their finances? Tailor your timing to accommodate their situation. For instance, if someone has a history of forgetting due dates, a gentle early reminder might be more effective. Instead, opt for moments when their financial situation is relatively stable.
- Create a Polite Reminder Message
Several factors contribute to the success of a transaction, including the manner in which you communicate with the recipient and how you present your message. To achieve the balance between a firm yet polite reminder,
- Start writing the text by saying their name and in a positive manner
- Avoid beating around the bush or using vague language.
- In the message, give details about the pending amount, invoice number, and other important details to help them remember the transaction
- To maintain a cheerful and non-confrontational tone, choose your words wisely. A negative or accusing tone that can make the receiver defensive should be avoided. Try mentioning, "I noticed the payment is still pending," rather than, "You haven't paid yet."
- Include a clear deadline for the recipient to respond or make the payment.
In the cases where there is a genuine situation that is making your client default payment, offer assistance or suggest possible solutions. For example, you could say, "If you're experiencing any difficulties with the repayment, please let me know, and we can find a solution."
Conclude your reminder message with a polite and professional sign-off. A simple "Thank you for your prompt attention to this matter" or "I appreciate your cooperation" adds a courteous touch to your message.
- Resend the Invoice
Out of the thousands of Emails that one receives, there is a possibility that your client might have missed your previous email with the invoice. So it is always best to give the benefit of the doubt to your clients. You can craft a polite reminder message, attach the invoice along with the email, and send it again. This way, you avoid further doubts and ensure your clients have all the details necessary.
- Avoid Confrontation and Accusations
You know, finding that balance between sending frequent effective reminders and keeping our relationships with that defaulting client intact can be a bit tricky. Whether we're talking about personal or professional connections, using confrontational language can actually ruffle some feathers and strain your relationship. No one likes to feel attacked or accused, and a simple reminder shouldn't jeopardize your relationship.
So throughout your message, maintain a professional tone. This means avoiding any harsh or critical language and keeping the conversation focused on the issue at hand. Politely request their cooperation in resolving the matter. Use phrases like, "I kindly request your prompt attention to this matter," which conveys the importance of their involvement without sounding demanding. This credibility can open doors to future opportunities and collaborations. Remember, your aim is to resolve the payment, not to assign blame.
- Leveraging Technology for Reminders
Let's explore a powerful tool at our disposal - technology. Specifically, we're talking about automatic payment apps and platforms. These digital wonders can take the hassle out of reminding, ensuring that payments are made promptly and professionally. Automatic payment apps allow you to set up recurring payments. This is incredibly useful for regular bills, subscription services, or rent collection. Once the payment details are entered, the app takes care of the rest, processing payments on the agreed-upon schedule.
For example, Cone’s proposal to payment software is one of the best software that you can use in this matter. This software takes care of everything from the beginning and even sends friendly reminder emails for upcoming payments. Further, the best feature of this software is that it provides your clients with multiple options to pay! This is excellent software for business people as it completely automates the procedure while saving you time and effort.
Pro-Tip: Learn about best online proposal software.
What to Do If Payments are still not received
While we all wish for quick and straightforward responses, life has a way of throwing curveballs. Here is a common situation - Your attempts to remind them go unanswered. The first piece of advice would be to refrain from drawing judgments too quickly. Your reminder could occasionally have been overlooked by them due to their hectic schedule or put in their spam folder. Therefore, it's wise to give them the benefit of the doubt and send them a considerate message after.
Before taking any further action, give them some time to answer. Rushing the process may not yield the best results. If your initial reminders were via email, consider reaching out through other channels if possible. You can try sending a polite text message to their personal phone number or even give a phone call. Trying out different methods of communication can work out in your favor.
In your follow-up message, express your willingness to work out a solution that suits both parties. Offer flexibility in terms of payment options or timelines, if appropriate. This shows your commitment to resolving the matter amicably.
If all else fails and your attempts to communicate go unanswered, you may need to explore legal options.
When to Seek Legal or Professional Advice
There may come a time when your best efforts prove fruitless, and you find yourself facing a persistent non-payer. This is when it's crucial to know when to seek legal or professional advice. Further, if your attempts to communicate with the debtor have repeatedly failed, and they remain unresponsive to your polite reminders, or if the debt is significant and crucial to your financial stability you can directly consult a lawyer.
It's a good idea to seek advice if you frequently deal with instances where clients or people are perpetually late with their payments.
Conclusion
Sending timely reminders is crucial as a business owner to streamline your cash flow. Moreover, regular reminder shows professionalism, reduces stress, and helps maintain client-owner relationships.