You get a service, you get a service, and you get a service, now show me the money!!!
Money (and a lot of coffee!) makes the creative business world go round. You need to make money, preferably a lot of it, to really keep your creative thoughts flowing. We're not here to tell you how much you should be making, that's up to your bottom-line to decide. What we can help with is some tips on how to get those invoices paid, and keep the doors open.
You have the creative talent, you've delivered excellent customer service, and you hopefully have a contract that stipulates clear transactional terms. Now for the important part, the part that means you can actually pay your staff next month, it's time to collect payment. For some clients this is a straight forward process, you send an invoice and they promptly pay. While for others this seems to become a complicated, awkward, time-consuming, empty promise pitfall. This is the huge downside of business and it has to be managed effectively so that it doesn't take your creative soul.
Invoicing is a chore and probably not your favourite thing. So let's look at how we can try and take this process from painful to profitable.
Your invoice checklist.
Know your worth. Set your rates right from the outset so that when you do get paid, it compensates you and sets you up for success.
Be clear with your payment terms. Opt for short timeframes and break up large projects into small instalments. It's best to get a deposit before work commences, and be clear from the outset as to the formats and number of revisions allowed etc. Any additional fees should also be included as reference.
Make it look good. Use your creative vibes in all your client touchpoints, including this one. People do appreciate the effort.
Send it quickly. Don't just send invoices at the end of the month, even better know when your clients have their payment cycle. Ultimately though try and send the invoices as promptly as possible so it's fresh in their minds what they are paying for. It's also a good idea to always check who the right person is to actually send the invoice to, it might not be your primary contact for the work itself.
Make payments easy with multiple payment options. Think PayPal, Stripe, Square, and direct deposit. You can even resort to carrying a card reader with you if you are regularly having face to face meetings with clients.
Protect your IP until final payment. Use watermarks and disable downloads on your final deliverables where possible until the money has actually hit your account.
Reward early and on time payments. This might be in the form of an early bird discount or a handwritten note (that can still be sent electronically) upon payment.
Automate. You need to find a process that allows you to get organised and easily track who has and hasn't paid what. Most of you would be using Xero, MYOB or Wave to help with your accounting, who all in turn have great tips for getting paid on time. With any of these tools you can set up auto-creation of recurring invoices, automatic payment reminders, and provide integrated payment options. There are also some great tips on how to approach your automation in one of our previous blog posts.
Follow through on missed payments. You will need to use your full artillery here, emails, phone calls, and even formal notices when required. Again this needs to happen promptly and a lot of the steps can be built into your automated process.
Enforce additional fees. Even for your regular clients, if there are extra revisions, different formats required, or even just late fees. Business is business and that means exchanging money for ALL services provided.
Big business pay $115bn late to small business each year.
Over half (53%) of invoices are paid late.
Payment arrives 23 days late on average.
This results in SMBs experiencing slower revenue growth and in turn causes a flow on effect with late payments to their supplies.
I'm sure you've had people say to you that clients can't expect to get your creative genius for free, you're not running a charity. The reality is even charities need money to operate. You have bills to pay and so the simple fact is you need your invoices paid on time, every time. At the very least most of the time. Use this checklist to help get your invoices paid and keep your creative doors open.