Late or unpaid invoices constitute a significant problem for businesses. Waiting weeks or months to receive payment from clients disrupts cash flow and makes it difficult to pay bills on time.
You also have to worry about increased administrative costs as you try to recover the funds. A solid invoice management strategy is the only way to keep clients paying on time and consistently.
In this blog, we’ll outline some of the most common issues that cause clients not to pay and what you can do about them. We’ll also show you how SeamlessPay can help your business get paid sooner and more efficiently.
Common Issues that Lead to Unpaid Invoices
Invoicing issues can lead to confused clients and missed payments. Here are a few of the most common problems.
Not communicating with your clients can lead to misunderstandings or disagreements and cause payments to get delayed.
Unclear Payment Terms
If the client can't tell when or how to pay, your business may never receive the money owed.
Make sure to define your payment terms on all invoices clearly.
Keep clients updated on new processes and payment expectations. If you make changes without informing them, they may be caught off guard and unintentionally miss their due date.
Lack of Automation
Manually sending out invoices can lead to delays, errors, and misfiled documents. Automating the invoice process keeps everything organized and makes it easier for customers to pay on time. According to a study by Ardent Partners, businesses that automate their invoice process can reduce processing time by up to 50%. This means that invoices are sent out faster, and payments are received sooner.
The Financial Impact of Unpaid Invoices
Unpaid invoices can torpedo your business’ finances.
In fact, 82% of small businesses go out of business due to cash flow issues such as late payments.
When you don't get paid on time, the delay triggers a domino effect that may ripple throughout your entire company.
For example, a lack of funds could mean you can't pay a vendor, which might affect your ability to buy more inventory. You may have to turn away new customers while you wait to restock.
If too many clients ignore invoices, you could enter debt as expenses pile up and interest accrues.
The True Cost of Unpaid Invoices
The costs associated with unpaid invoices are too high for many businesses to withstand. You can't afford to ignore an overdue invoice, but you also may need more resources to deal with it properly.
You have to track down the client, process paperwork, and send follow-up letters or emails. Plus, you may have to pay additional fees for legal services if the situation escalates.
Lastly, the stress and wasted time that comes with constantly checking in on invoices can be exhausting.
Strategies for Streamlining Invoice Processing
It’s time to think about effective invoice management and processing. Businesses that allow customers to make online payments via electronic invoices average 15.4% more paid invoices. These strategies can help you get paid sooner:
Standardize Invoice Procedures
Create a standard procedure for each step of the invoicing process, from initial contact with clients to collecting payment. Clients know what to expect, and you can keep track of outstanding invoices.
Automate Invoice Processing
Having a system that automatically generates invoices and payment reminders saves time. Automation also makes it easier to manage different types of payments and keep your records accurate.
Improve Communication with Clients and Customers
Develop a system for keeping in touch with clients or customers. You should be proactive about reaching out, asking questions, and sending payment reminders if necessary.
Managing invoices can be a full-time job. You can eliminate hours of labor by outsourcing most of the work to technology. An automated platform like SeamlessPay allows businesses to control their invoicing without doing any manual labor.
SeamlessPay: A Better Way to Invoice
SeamlessPay is the perfect solution for companies looking to stop collecting unpaid invoices.
The platform offers various features, such as automatic invoice generation, capability to deliver invoices through text or email, custom payment terms, and online payment tracking. SeamlessPay allows payments to be made via all major credit and debit cards, ApplePay, Google Pay, and ACH. You can also send out electronic reminders to customers before payments are due.
Our integrated customer support system lets you address any billing concerns quickly and easily.
By automating your invoicing process, SeamlessPay helps businesses save money and time.
Every company has to deal with unpaid invoices at one point or another. The key is to mitigate the frequency and number of late payments to avoid significantly harming your bottom line.
SeamlessPay makes it easy for you to manage invoices and get paid on time. Our innovative platform helps businesses of all sizes.
Start getting paid sooner with automated invoicing from SeamlessPay. Contact us today!