As a small business owner, expanding your customer base by offering invoicing may significantly boost your business. Unfortunately, it also leaves you with receivables out there that you'll have to collect on. In an ideal situation, your customers will pay their invoices by their due date every time. However, business interactions aren't always ideal. Here are a few tips to help you collect on those outstanding accounts and keep your cash flow moving.

Use Accounting Software

When you start offering invoicing, it's in your best interest to invest in some accounting software that lets you keep track of your outstanding invoices and their due dates. Most accounting software programs also allow you to generate aging reports to make it easier for you to see which invoices are oldest and need to be collected first. There are many small business accounting programs out there, so you can pick the one that's the best fit for your needs.

Make Your Invoices Clear

Use an invoice format that makes it easy for your customers to understand when the debt is due. Put the due date and the payment terms in large, bold letters on the top of the invoice. That way, there's no risk that your customers won't understand when they have to make the payment.

Offer Flexible Payment Options

Provide your customers with many ways that they can pay their invoice, including credit cards, checks, and even online transfers. When you provide many choices, you increase the chances that a customer will pay right away simply because of convenience.

Provide Incentives For Early Payment

Offer your customers a benefit for making the payment early or on time. The better incentives you can offer, such as a ten percent discount, the greater the chances that they'll take advantage of it and issue payment.

Be Willing To Make Calls

Generate an aging report once a week to help you spot the clients who are past due. Make an effort to call those customers each week to remind them that a payment is due. The more proactive you can be about collecting on those accounts, the better chance you'll have of closing them out and recording the cash flow.

Hire A Collections Company

Recognize the fact that every business selling on accounts will have the potential of uncollected and delinquent accounts. Retain the services of a collections company to help you address those outstanding balances. Set an aging point at which every account is turned over to collections, such as 60 days past due.

For more information, contact Blueback Accounting or a similar company.

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