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Join Date: Apr 2012
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| | Re: Offering a discount for early payment
As you are selling services I would not be inclined to offer a discount as you have already provided the service for them
I tend to pay easiest invoices first - those with no credits, that send me correct paper work, best payment option etc.
Instead I would concentrate on making it easy for them to pay you by
1) invoicing them quickly - email
2) send follow up statements - this acts as gentle remiander
3) change your payment terms to 14 days
4)offer number of payment options PayPal, direct debit, bpay, cash, credit card don't put my barriers between you and taking money. It might cost you more in fees but worth it to have in your hand.
5) Arrange monthly direct debits with regular customers this is a win win worth the initial paperwork, as you know coin will be coming regularly.
6) train your customers nothing wrong with a polite call asking when the invoice will be paid. Sometimes better to get accountant or someone else to do this as it can be difficult being money chaser and seller
Generally large corporations you are screwed you cannot get them to pay outside their account department cycle. With smaller buisnesses if you are providing a good service nobody will mind if you ask for quicker payment terms. Never hurts to call them tell them you changing payment terms due to having to pay suppliers and needing cashflow. Truth often works very well.
If any customers kick up a huge fuss about having to pay sooner than they probably have bad cash flow are going out of business and quite frankly you are better of rid of them