How can you encourage timely payment from customers?

On Behalf of | Sep 1, 2021 | Contract Disputes |

Even with a clear payment contract in place, sometimes your customers will procrastinate payment. While they may not view this as a big deal, their ignorance can take a toll on your organization.

Encouraging your customers to pay in a timely manner may look different depending on the industry you work in and the products or services you sell. However, knowing some common strategies may help you to effectively acquire payment before things get ugly.

Consistency and consequences

At the start of working with a new customer, establish your expectations for payment. Determine a consistent payment pattern that works for both parties. Even if something unusual occurs during a payment period, stay consistent about the frequency of your billing. This will help everyone know what to expect which can reduce misunderstanding and frustration.

Likewise, inform your customers of the consequences of late or missing payments. Even if it feels uncomfortable, maintain consistent consequences for any breach of payment terms. You may consider issuing a formal reminder or warning if a non-paying customer has not formerly missed a payment. However, if they continue to ignore your requests, issuing a consequence can protect you from continued disregard and more serious issues.

Relationships and rapport

Developing good relationships from the beginning may effectively minimize payment discrepancies with your customers. According to Entrepreneur, your ability to establish a personal connection with each customer can make it less awkward to ask for payment if they forget to pay. Additionally, with a good relationship, your customers may feel more incentivized to make payments on time.

You can build rapport when you treat your customers with professionalism and respect. Because you have rights too, you can also expect the same treatment from them. If you experience ongoing problems with a negligent customer, you may need to take legal action against them.