We All Gotta Get Paid!
Don’t you just love the feeling when prospective clients say “yes” they want to work with you? It’s so fulfilling when you know you can help someone, and they instill their trust in you!
At this point, you’ve “booked” the business, and one of your next steps is to direct them on when and how to pay you. You can choose from various approaches, depending on the situation and when you need cash flow in your business. Below are a few scenarios to consider.
Pay at Time of Booking
If you can collect payment upfront, that provides you with immediate cash flow and ensures your client’s commitment. If you provide a service that clients might cancel or fail to finish, it gives them more “skin in the game” to keep their commitment since they’ve already paid for it. Just don’t forget to provide your refund, cancellation, and termination policies.
A monthly installment is typically used for subscription-based services or billing for hours worked. This method can also help your price-sensitive clients by spreading the expense out over a few months instead of collecting the entire fee upfront. Whatever your reasons for using this method, we recommend finding a way to automate it. Set it up, forget about it, and watch the money flow into your bank account!
Corporate clients typically require an invoice which can take up to 180 days to pay. Who wants to wait six months to get paid? It’s critical to negotiate payment terms when you book the business. Remind them you are a small business and request “due upon receipt” payment terms.
Serve Now, Pay Later
Have you ever spoken with a prospective client that is a PERFECT FIT, and you really, really, really want to help them, but they simply can’t afford it right now? Consider offering creative approaches to their payment. Perhaps they start with a minimal down payment and pay the rest over time as their budget allows. Yes, there is a risk that you won’t get paid. And in our experience, most people are incredibly honest and will make good on their financial commitment to you, especially if they get the results you promised.
This is not an exhaustive list! If you need help figuring out which payment method is best for your business, we’ll offer you a complimentary consultation.