1. Communicate with your client
Friendly client email template:
Copy and Paste! The following email is friendly and professional, and it reminds the client of the outstanding invoice and the payment due date. It also leaves the door open for communication and offers to work together to find a solution if there is a reason for the delay in payment.
I hope this email finds you well. I wanted to reach out and politely remind you about an outstanding invoice for the [project/service] we completed on [date]. The invoice, which was sent on [date], is for a total of [amount] and is due [date].
If you have already made the payment, please disregard this email. However, if you have not yet paid, I wanted to make sure that the payment has not been overlooked. If there is a reason for the delay in payment, please do let me know and we can work together to come up with a solution.
To review the payment terms, please refer to our contract, which can be found at the following link: [Insert link to contract or other document outlining payment terms].
I appreciate your prompt attention to this matter and I would be grateful if you could process the payment as soon as possible. If you have any questions, please don’t hesitate to contact me.
2. Understand the reason for the delay
3. Offer electronic payments to reduce overdue payments
Stripe can integrate with your website and some existing systems
4. Offer a payment plan or adjust the terms of the invoice
If you are not in a hurry to collect the full amount due, consider collecting payment in stages. This option allows your client to pay the total amount due in smaller installments over a set period of time. For example, you might agree to receive a certain percentage of the total amount due upfront, with the remaining balance paid in equal installments over the next few months. Be sure to set up a reasonable minimum payment.
Credit card or automatic payments:
Some clients may be more comfortable paying by credit card or setting up automatic payments from their bank account. This option allows them to pay in smaller increments over time, rather than paying the full amount all at once.
Financing with minimum payment:
If your client is unable to pay the full amount upfront, they may be able to secure financing through a bank or other lender. Credit score and payment history may be a factor in your client obtaining financing. This option allows them to pay the total amount due in smaller installments over a longer period of time, typically with interest.
5. Consider legal action
If you need to send an invoice to collections or take legal action to recover payment, here are some steps you can take:
Communicate with your client:
Before taking any legal action, it is important to make sure that you have made a good faith effort to communicate with your client and try to find a resolution. This may include sending multiple payment reminders, offering a payment plan, or adjusting the terms of the invoice.
If you decide to take legal action, you will need to have documentation to support your case. This may include copies of the invoice, any communication with your client regarding payment, and any contracts or agreements that outline the terms of the payment.
Consider hiring a collections agency:
A collections agency can help you recover the payment that is owed to you. They will typically handle communication with the client and may be able to negotiate a payment plan or settlement on your behalf.
File a lawsuit:
If all other efforts to recover the payment have been unsuccessful, you may need to consider filing a lawsuit. This could be a small claims court lawsuit if the amount owed is relatively small, or a civil lawsuit if the amount is larger. It is important to consult with a lawyer before taking this step, as lawsuits can be complex and time-consuming.