Running a business is hard enough, but when customers don’t pay on time, it can make things even tougher. Unpaid bills can slow down your cash flow, and chasing after money can feel awkward. But don’t worry, there are ways to handle this, especially if you’re busy with other concerns and your production is escalating.
We all know dealing with customers is never easy, and sometimes they might even get mad at you. If that is your case, we suggest you read this post about how to deal with unhappy customers before proceeding with the one down here.
Here are 5 simple tips to help you collect money from customers who won’t pay—without causing bad feelings.
1. Set clear rules from the start
The best way to avoid payment problems is by being clear from the beginning. Make sure your customers know when they need to pay and what happens if they’re late. Adding a late fee can give them extra motivation to pay on time.
What to do:
- Use a contract: Every job or sale should come with an agreement that explains when payments are due and what will happen if they are late.
- Send reminders: Remind customers about their payment a week before it’s due, and again on the due date.
By being clear from the start, customers are less likely to delay their payments.
What to say:
“Hi [Customer Name], just to confirm, our payment terms are 30 days from the date of the invoice. We also have a late fee of [amount] if payments are delayed. Does that work for you?”
2. Follow up right away
If a payment is late, don’t wait too long to reach out. Sometimes there has been a mistake, or the customer may have forgotten – especially in cases such as Net 30 or Net 60 where it takes too long until the next payment due date. Contact them quickly but politely to remind them about the payment.
What to do:
- Send a reminder e-mail: A friendly email can help get customers’ attention without making them feel bad. Assume he has forgotten the payment when writing the e-mail, and you can also attach a copy of the invoice to this e-mail, making it easier for them to pay it.
- Make a phone call: If emails don’t work, try calling. A quick phone call can often solve the problem faster than waiting for an email reply.
Stay polite and professional—your goal is to get paid, not to lose a customer.
What to say in an e-mail:
“Hi [Customer Name], I hope you’re doing well. I just wanted to send a quick reminder that your payment for invoice [#] was due on [date]. Could you please let me know when we can expect payment? If you need any help or have questions, feel free to reach out.”
What to say in a phone call:
“Hi [Customer Name], this is [Your Name] from [Your Company]. I wanted to check in about the invoice we sent you on [date]—it looks like it’s overdue. I just wanted to see if everything is okay and when we can expect payment.”
This approach is friendly but clear that payment is expected soon.
For this particular case, you can overcommunicate for one or two weeks if you think it is necessary, before proceeding to step number 3.
The goal is to establish clear communication, check what happened, and make sure he knows the payment is delayed.
3. Offer payment plans
Ask your customers why they aren’t paying. Are they on vacation? Have they switched to another billing provider or banking service and need more time? And also, sometimes, customers can’t pay because they’re low on money.
In this case, offering a payment plan may help. This way, they can pay you over time instead of all at once.
What to do:
- Discuss a payment plan: Reach out and offer to split the payment over several months or smaller payments that fit their budget.
- Get It in writing: Make sure to have everything written down so there’s no confusion later.
Offering a payment plan shows you’re willing to work with them, but make sure to set some boundaries still.
What to say:
“Hi [Customer Name], I understand things might be tight right now. Would it help if we set up a payment plan? We could break the total into smaller payments that you can manage more easily. Let me know if that sounds like a good option for you.”
This shows you’re willing to work with them, but still clear that you’re expecting payment over time.
4. Give a discount for fast payment
Another way to encourage quick payment is by offering a small discount if they pay right away. Some customers are more likely to pay if they can save a little money.
What to Do:
- Offer a Discount: Give a small discount, like 5-10%, if they pay within the next day or two.
- Create Urgency: Make the discount time-sensitive so they feel the need to pay quickly.
A small discount may be worth it to avoid the trouble of chasing payments for weeks.
What to say:
“Hi [Customer Name], we’d love to settle your account as soon as possible. If you can make the payment by [specific date], we’re happy to offer a [5-10%] discount on the total amount. Let me know if this works for you!”
This encourages the customer to pay now, instead of letting the invoice continue to sit.
5. Use a Collection Agency
If nothing else works and the customer still won’t pay, you may need to hire a collection agency. These companies specialize in collecting unpaid bills for businesses.
What to Do:
- Find a Good Agency: Research collection agencies to find one that fits your needs.
- Understand the Cost: Collection agencies usually take a percentage of the money they collect, so be prepared to lose a bit of what’s owed.
Using a collection agency should be your last resort, but it can help if nothing else is working.
What to say right before you choose to use a Collection Agency:
“Hi [Customer Name], we’ve tried to reach you several times regarding the overdue payment for invoice [#]. If we don’t hear back from you by [specific date], we’ll have to refer this matter to a collection agency. We’d prefer to resolve this directly, so please contact us as soon as possible.”
This message is firm but gives the customer one last chance to pay before you take further action.
Final Thoughts
Collecting money from customers who won’t pay is never fun, but with these simple steps, you can handle it more easily.
Be clear about your payment rules, follow up quickly, and offer flexible options when needed. This way, you’ll protect your business and keep things running smoothly.
Also, consider adding late fees to your future contracts to stimulate customers to pay on time – and give you margins to negotiate discounts if they are still late in any case.
Upon contacting the customers you have, keep up prospecting new ones. We have great tips for you about how to make better marketing using a free and popular tool: Instagram. And don’t forget to follow SlabWare’s profile on Instagram as well!
And how SlabWare can help you
Using software to control your invoices and payment due dates can also help. SlabWare integrates with QuickBooks to keep track of your shop’s accounting.
And more, you can automate the e-mail sending so the system will automatically send messages to your customers right before their invoices expire, and also after they expire, with the message you set up, and the frequency you set up.
It can help you keep your payments up to date without the need to check every day who’s due and who’s not, and manually contact them.
Try SlabWare for free now by clicking here, and schedule a demo with our team.
