How to Handle Late Payments from Consulting Clients

Collecting money is a pain in the a**. I’ve tried every fancy debt collection system. Nothing works as well as this painfully simple strategy: 𝟭. 𝗣𝗲𝗿𝘀𝗼𝗻𝗮𝗹𝗶𝘇𝗲𝗱 𝗥𝗲𝗺𝗶𝗻𝗱𝗲𝗿 𝗦𝘆𝘀𝘁𝗲𝗺 Don't let automated messages do the talking. Personalize your reminders with a friendly, human touch. A simple, personalized email or call can make a world of difference in getting those overdue payments settled. 𝟮. 𝗜𝗻𝗰𝗲𝗻𝘁𝗶𝘃𝗲-𝗕𝗮𝘀𝗲𝗱 𝗥𝗲𝗽𝗮𝘆𝗺𝗲𝗻𝘁 Motivate your clients to pay on time by offering small discounts or benefits for prompt repayments. It's a win-win; they save a bit, and you get your dues faster. 𝟯. 𝗧𝗿𝗮𝗻𝘀𝗽𝗮𝗿𝗲𝗻𝘁 𝗖𝗼𝗺𝗺𝘂𝗻𝗶𝗰𝗮𝘁𝗶𝗼𝗻 𝗣𝗿𝗼𝘁𝗼𝗰𝗼𝗹 Clear, consistent communication is key. Establish a protocol for transparent communication about debts — it reduces the risk of misunderstandings. Ensure your clients know exactly what they owe and why. 𝟰. 𝗖𝘂𝘀𝘁𝗼𝗺𝗶𝘇𝗲𝗱 𝗣𝗮𝘆𝗺𝗲𝗻𝘁 𝗣𝗹𝗮𝗻𝘀 One size doesn't fit all in debt repayment. Tailor payment plans to individual client circumstances. This flexibility often increases the likelihood of repayment and ensures you meet the needs of all clients. 𝟱. 𝗥𝗲𝗮𝗹-𝗧𝗶𝗺𝗲 𝗗𝗲𝗯𝘁 𝗧𝗿𝗮𝗰𝗸𝗶𝗻𝗴 𝗗𝗮𝘀𝗵𝗯𝗼𝗮𝗿𝗱 Use a simple, user-friendly interface where both parties can monitor outstanding debts. It ensures everyone's on the same page and provides an easy way to keep track. 𝟲. 𝗙𝗿𝗲𝗾𝘂𝗲𝗻𝘁 𝗨𝗽𝗱𝗮𝘁𝗲𝘀 In the most non-intrusive way possible, keep clients informed about their debt status with regular updates. These reminders keep the debt on their radar, but it's your job to ensure they're not overbearing. 𝟳. 𝗘𝗺𝗽𝗮𝘁𝗵𝘆 𝗧𝗿𝗮𝗶𝗻𝗶𝗻𝗴 𝗙𝗼𝗿 𝗖𝗼𝗹𝗹𝗲𝗰𝘁𝗶𝗼𝗻 𝗦𝘁𝗮𝗳𝗳 Nobody likes being pestered about their debt. Handling it too aggressively can leave a bad taste in the client's mouth. Train your staff to focus on empathy and understanding. This equips them to preserve client relationships even in tough financial situations. Debt collection doesn't have to be complex or aggressive. This simple strategy has been a game-changer for me. Use it and get that bag!

The Ultimate Payment System That Changed My Business Forever Ever wondered how some businesses never worry about late payments? Here's my exact system that transformed endless payment chasing into a 24-hour guarantee. The game-changer? Automation + non-negotiable rules. I switched from hoping clients would pay to knowing exactly when money hits my account. Here's the breakdown: 1️⃣ The Foundation: • 50% upfront deposit (non-negotiable) • OR 100% upfront with 10% discount (surprisingly popular!) • Clear payment milestones in contracts • Kill fee clause for protection • Automated invoicing through Stripe/Honeybook or your invoice system of choice 2️⃣ The Follow-Up System: • 3-day advance reminder • Due date notification • Post-due sequence (hasn't failed yet!) Why this works: It's all about psychology. When you set professional standards and automate the process, you remove the awkward money conversations. Clients respect clear boundaries, and your bank account thanks you. Pro tip: That 100% upfront payment option? It's gold. Many clients prefer handling everything at once, and the 10% discount is worth the guaranteed payment and stress-free project. The best part? Once set up, it runs on autopilot. No more late-night anxiety about unpaid invoices or awkward payment conversations. Your work deserves respect, and your bills don't wait for client payments. Remember: You're running a business. Your payment terms aren't suggestions – they're standards. Having a system isn't about being rigid; it's about being professional. Key takeaway: Automate your payments, set clear boundaries, and watch your cash flow transform. Because successful businesses run on systems, not hopes. #BusinessStrategy #SmallBusiness #PaymentProcesses #BusinessSystems #EntrepreneurialMindset #SystemizeYourBusiness #AutomatedBusiness #ClientPayments #FreelancePayments #PaymentAutomation #BusinessSystemization #ClientManagementTips #FreelanceFinance #BusinessProcessAutomation #SmallBizFinance

Do you plan to invoice clients for work that was already accomplished? Two financial processes take up a lot of time for your new business: Accounts Payable (AP) and Accounts Receivable (AR). AR is one of the immediate areas I like to look at when consulting with small and medium businesses (SMB). I've found, on more than one occasion, more than a year of profit sitting in a business's AR -- sometimes several years old and uncollectable! What's worse is when the SMB is still doing business with these deadbeats!!! If you plan, in your new business, to bill customers for work performed, it's important to develop AR processes now. That's the focus of this week's Saturday Startup Series. First off, challenge your business model and see if there's a way to collect payment up front for services to be rendered. This means you need to work extra hard to build trust with new clients. Second, sit down with a lawyer and build ironclad contracts that you plan to use with well-thought-out terms and conditions (Ts & Cs). Operating a business on AR without a contract will end in ruin. However, a poorly designed contract could be worse. Include these items in your Strategic Business Plan (SBP). Third, ensure you're looking, at least weekly, at your AR. Looking at the total AR and Days Sales Outstanding (DSO) isn't enough. You need to be able to see how late every single client is on AR. In this, the Devil is in the Details! Share these metrics and your review process in your SBP. Lastly, you need a clear, easy to follow, and legal AR Escalation Process. There's no messing around with this. Once you bill a client, you are legally required to perform certain actions by certain dates. It should include stopping work without pay. If you hope to legally retrieve your money owed, you have to do this right. This process should be outlined in your SBP as well. When I first started out consulting on the side, I didn't have a contract or a process. And I billed for work after it was done. I had a client that I amassed over $30K in outstanding billed work in four weeks. That client never paid, and I still had to pay someone who worked with me out of my pocket. Don't let this nightmare end your business before it ever starts!!! ….. Follow me if you enjoy discussing business and success daily. Click on the double notification bell 🔔 to be informed when I post. #betheeagle

One client delayed the invoicing by 10 days and ended up with an $10K cash crunch. All because the system that delivered the work wasn’t the system that asked for payment. That’s the thing about late invoices. They don’t just delay cash. They break momentum. 👉 You pause hiring. 👉 You delay vendor payments. 👉 You hold off on growth opportunities And the worst part? It’s avoidable. Here’s what I advise every founder to do: 1. Automate invoice triggers ⤷ Send them to go out the moment a milestone is marked complete. 2. Make payment frictionless ⤷ Attach payment links directly to the invoice. Fewer clicks = faster collections. 3. Clarify terms early ⤷ Don’t just hide them in the contract. Say it upfront, again in onboarding, and reinforce gently. 4. Schedule auto-reminders  ⤷ Three days before the due date. Again, on the due date. Let software do the nudging. 5. Review receivables weekly ⤷ Block 30 minutes. Check what’s due. Don’t outsource what you should be owning. PS: How do you make sure your clients understand your payment terms upfront?