6 Tips on How Merchants Can Get Paid Faster
For merchants running a small business, chasing down unpaid invoices, and sending late payment reminders can impede growth. Late payments aren’t just an inconvenience – it’s an opportunity to lose money, vendors, and enough cash flow to slow progress on other projects.
Getting paid on time or early can alleviate this problem. Below are some practical tips that merchants can implement to get paid faster, improve cash flow, and boost their business.
Tips on How to Get Paid Faster
1. Automate Invoices, Reminders, and Follow-Ups
Having a system that automatically sends invoices means vendors can receive and settle their bills in a timely manner. Electronic invoicing can eliminate mistakes, make it easy for clients to pay quickly, and help merchants stay on top of late payments via email notifications and phone call payment reminders.
2. Provide Flexible Payment Terms
Creating a customized payment plan, such as easy installments, allows vendors to not miss a payment. Merchants can also offer auto-pay options, so clients don’t have to worry about remembering when their next payment is due.
3. Reward Upfront and Early Payments
Merchants who offer a discount for early payments give vendors some financial reward for doing business with them and it ensures that the merchant is paid on time.
4. Enforce Late Fees
Merchants should draft clear payment terms (based on state regulations) in their vendor agreements, including the percentage or flat rate of the late payment fee. This way clients can be held responsible, and merchants can keep their cash flow moving.
5. Accept Multiple Payment Types
Merchants who offer many convenient payment options to their vendors have a much better chance of getting paid on time. Accepting cash, card, ACH, and digital payments allows clients to pay in the manner that works best for them. In turn, merchants get paid faster!
6. Use Integrated Payments Software
Merchants who use integrated payment processing and accounting software have a better view of the financial landscape. System integration allows streamlined and automated payments to occur and promotes better business operations and increases case flow.
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