Asking for Payment: Why We Resist – And 3 Ways to Get Paid Without Asking

Asking for Payment. Why We Resist – And 3 Ways to Get Paid Without Asking

Why do so many of us provide products or services to customers but then feel that asking for payment is too embarrassing?

A sale is not a sale until it’s paid for

It seems that asking for payment of invoices due to us is somehow seen as ‘unacceptable’. Dare I say even ‘un-Australian?’ But late payments can be a serious problem for small business owners.

64% of small businesses report having invoices go unpaid for at least 60 days (NFIB)

Late payments can lead to cash flow problems which can lead to business failure…

Just this week I witnessed a personal illustration of being too embarrassed to ask for money to be repaid. Asking for payment seemed to be out of the question…

My friend lent a close family member a large sum of money to buy a car. A few monthly payments were received on time and as agreed. Then 3 or 4 months went by and there were no payments and no explanations either.

When I asked my friend why he hadn’t followed it up. He said HE was too embarrassed to ask for payment!

The Big problem for small business owners

The problem is that owners can delay asking for payment of invoices because they don’t know exactly what to say. And, because they don’t know what to say, they fear they may upset their customer.

Small business owners are often concerned that they might cause irreparable damage to their business relationship.That’s stressful and enough to stop people from making that call.

The good news is that there is a simple 3-step strategy that will get most of your invoices paid by the due date.  It’s proven and it doesn’t have anything to do with making collections calls. It’s good old-fashioned customer service.

I know it works because before I sold my business, our part-time administrator used it and our customers paid us by the due date. Cash flow was good, we never needed a loan and we had great relationships with our customers too.

3 – Step strategy to getting paid without asking

Step #1: Invoices – get them right

A whopping 50% of invoices aren’t paid on time because there’s a mistake. Customers don’t pay invoices with queries on them. Only send invoices out to customers when they are 100% correct in every way.

Step #2 Call before the invoice is due

Make a ‘customer service’ call to your customer to check that they are completely satisfied (we called it a ‘Courtesy Call’).

While you are talking with them, just gently find out that the invoice is in the right place with the right person. Under the guise of providing great customer service, you’re making sure there are no queries and the invoice is authorised to pay.

Customers will love your good service. This call was one of the ways we built our reputation as a supplier of choice.

Step #3 Resolve queries super-fast

When you make a Courtesy Call, you get to know BEFORE the invoice is due for payment if there’s a query.

If our customer did have a query, we resolved it as quickly as possible. The sooner the query is resolved, the sooner the invoice can be paid. Then asking for payment can just be a gentle extension of the query resolution process.

Done well, this can also build your reputation as a ‘can-do’ supplier.

Replace stress with money in your bank

When you put these 3 simple strategies in place, you will be amazed at the result.

Just making sure your invoices are correct will give you a 50% better chance of being paid on time. Add in step #2 and customers will love your good service. If by chance your customer does have a query, you get the chance to resolve it fast and still get paid on time.

You may never have to make a collection call again. Isn’t that an easier way to get paid than waiting until the invoice is overdue and then asking for payment?

To your business success!

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