11 Invoicing Tips For Tradies – To Actually Get Paid

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Get Paid

Let’s face it, while receiving money is great, invoicing is often a total nightmare for tradies and dealing with late payers is even worse. Nobody likes to chase clients or has the time to do so! The time we use to collect money is time we don’t get back and we could be using on another job.

#1   Research your client

Before you start working with a client, spend some time to see who your client is. See what people on social media are saying about them or do they complain a lot online? See if you can contract other suppliers or Tradies that have done work for them. Getting to know your client will help you to avoid a headache.

#2   Invoice for a percentage of the fee upfront

Depending on the size of the project you can ask for anything from 30% to 60% upfront. If you have a solid reputation your client won’t think twice in paying you. This also helps weed out the prospective clients who are wishy washy and are unlikely to commit to the project. If he or she’s not willing to pay you a reasonable upfront payment, they are likely wasting your time. You could offer a warranty (minus transaction fees) for upfront payments in case your client decide to cancel the project before you start doing any work.

#3   Make Invoicing a Priority

No matter the size of your business, cash flow is arguably the most important determination in whether or not your business succeeds or fails. While this may sound obvious, the sooner you send out invoices to clients, the sooner you’ll get paid—which means that the cash will keep pumping in. Something that is not as obvious is that if you are slow at invoicing, it sets the tone for your client. They are far more likely to not take payment seriously if you don’t take your invoicing seriously. Invoice as soon as you’ve completed a project.

#4   Automate the process

Make sure that you can send invoices immediately to your client’s email. Invest in the right invoicing software that has automatic payment reminders which includes direct payment options in each reminder. Have a reminder go out one day before an invoice is due, and then multiple overdue reminders after that. Make sure that your invoice PAID receipts go out promptly.

#5 Contact the right person

Sometimes your contact person is not the person in charge of paying the bills.  Make sure that you are sending your invoices directly to the person who has the ability to pay them. Always ask your client: ”In order to get paid on time, who is the best contact to receive this invoice?”. This helps to set the tone, in regards to your expectation that the invoice will be paid on time.

#6   Add your payment terms and keep them tight

Be clear about this with your clients. You must include the due date. Spend some time experimenting with your your payment terms. if you usually give 2 weeks to your clients to pay you an invoice, reduce that time to 1 week. Play with it until you feel comfortable with the way your clients are responding to your terms. Avoid 30 days or more, that is going in the wrong direction.

#7   Split your invoices into different phases where possible

A simple yet effective strategy is to send smaller invoices and get paid frequently for every stage of a project. This is highly effective when coupled with the next step: “Make it easy to get paid”.

#8   Make it easy to get paid

Making payments should be as easy as possible for your customers. The easier it is, the quicker they’ll pay. Offer multiple payment options.

Online payments are a must – they’re instant and easy for the customer. A crucial factor with online payments is to eliminate the surcharge on Credit Card payments. Take this expensive away from your clients  and they will love you for it. Its a tax deductible banking expenses and a drop in the ocean compared to a late payment and the bad payers nightmare..

** This is our golden nugget tip – It has the largest impact on getting paid!

 

#9   Invoice by email (digitally), not snail mail

Don’t get stuck in the dark ages. If you are sending your invoices via postage snail mail, please STOP. This is tied to tip #3. The sooner your clients receives his invoice, the sooner you’ll get paid. You are also missing out on multiple marketing and branding exercises by not implementing a system where you are guaranteed to have your client’s email address.

#10   Use invoicing software and keep your branding professional

This will inherently guide you towards best practices while allowing your invoices be received as highly professionally which will convey the message that you take your invoicing seriously and there is a system in place for recourse. Automated online invoicing software is worth its weight in gold in terms of cashflow and presenting a professional operation.

#11   Follow up

Unless the client is an old regular who always pays on time, don’t forget to follow up. Send the invoice, pick up the phone and tell your client you sent it. Email is a blessing but it has no guarantee that your email will arrive in the client’s inbox especially new clients where it could end up in the spam folder or worse you could have the wrong email address.