3 Major Reasons Contributing To Unpaid Invoices
Whether you are a freelance music teacher or a photographer or having your own small marketing agency business, there is one common thing between all of them is the probability of not getting paid on time from their respective clients.
Of course, there are ways you could battle those challenges and the best is to opt for an online invoice generator that can streamline your payment process. Small business billing app allows creating professional invoices, send payment reminders, manage expenses and tax overheads, sales report and much more. Furthermore, in the blog, we are going to understand the reason for unpaid invoices and the steps you need to take in ensuring to avoid making some costly business mistakes.
1) Missing Contract
In the business world, you can consider being more secure if you have it in black & white. In simpler words, whatever the terms or conditions you agree with your business partner, client or vendor, its best to have it in writing. If you are missing on signing the contract which means that your clients could escape making on-time payments or not at all sometimes. That does not mean that you are not to make rapport or build a client relationship by showing your willingness to work for a long time but also ensure that proper contract is in place before you begin with the work. Your contract should clearly outline the budget of the project, scope of work & job responsibilities, deadlines and any other details that get you paid on time.
2) Disagreement Regarding Work
A dispute in an invoice can unsubstantially delay your payment for much longer than you anticipated. A disagreement could occur for many reasons, big or small. The client might be dissatisfied with the quality of the work you provided or time is taken or even for a small aspect of the project. As always, the best way for a resolution begins with communication. Address the client in a professional manner and agree to discuss more on the same. As most of the work disagreement is due to a certain specific area of work that the client is unhappy about. Once you have identified the problem source, you can work on your dispute points to bring it to a neutral ground and resolve further. Also, ensure to have proper payment terms drafted in the contract with professional as well as friendly corporate language. In such a scenario, you can also approach the client and agree upon to complete the payment for the other part of the project for which the client has no problem with.
3) Your Client Is Broke Or Can’t Afford
Freelancer and small or midsize business owners do come across such a client once in a while wherein they can’t afford to make the payment. This could be due to many reasons, for instance, your client might be working for someone else and might be waiting for the payment to pay you or their sales are down or some unexpected expense did come up due to which you had to suffer. Though the reason might be genuine and a good business gesture, you could spare a few days or max weeks in order to receive your payment. However, also try and make them understand that ultimately you are also running a business and because of non-payment your business is also at the loss and suffering cash flow problem. Try to resolve this situation before it gets any worse than it is already. Still, if the business does not respond for the payment, you can politely inform or notify them that you would be taking necessary legal steps to further resolve the matter.
To run your business effectively and maintain cash flow efficiently, you’ll always be in need of proper tools such as a free invoice generator. Cloud-based invoicing solution provider Moon Invoice helps you with your daily business tasks and it also simplifies the process.
Moon Invoice offers you multiple payment options along with multi-currency support. With Moon Invoice you can work from anywhere by downloading apps available for all platforms, i.e, iOS, Mac OS X, Android, and Windows. In addition to this, the Moon Invoice app also helps your business with Import/Export & Print and Mobile & Sync.