As a Freelancer or Virtual Assistant, one thing that always pops up in conversation is how do you handle client payments.
For some, this is a big area of stress – clients late, clients avoiding you, disputing your worth. For others, those with a plan and process, this is the best part of their month. The key is to get your business in this second group’s mindset.
Lets further discuss some ways that you get your Freelance Clients to Pay on Time:
Be Professional and Clear
I know this sounds vague but it really isn’t. Having your payment structure in writing, as part of your onboarding process and ensuring that it is then discussed during your first onboarding call. By having them sign off on this, it clears up any confusion early – both as to the expectations on both sides, but also methods of payment and what to expect on those invoicing days.
By being clear on your ideal client, this will help ensure that you are working with clients that not only fit your needs but also make a difference on how your payment relationship could work as well.
Different Packages for Different Clients – in writing
Having a few options for your clients sometimes can make it easier for you both to understand this part of your relationship.
Deciding between Hourly/Retainer or Project work – terms of payment (monthly/semi-monthly/weekly, etc). Thinking and discussing this with your client not only helps in future cash flow planning for you and your business but it also enforces the terms and the repercussions of late payment and how it’s handled. This also bleeds into the next subject…
Bill in Advance and Promptly
By arranging for payment for work in advance, it gives you both the security in knowing that both of your time are protected. You as the on completing the work, and your client understanding what they are paying for.
Now, this isn’t to say that you can’t do 50% upfront vs full amount – this is something to discuss with your client. But ensure this is very clear in any commitment you make to one another.
Also, having a method if an issue arises, how to best proceed. Whether it’s a cash flow issue on your client, that you pause your commitment until they are ready to continue etc.
Having a great invoice system set up will help you keep these terms organized with each client. In an ideal world, you would have one set of terms for all but let’s face it, not one size fits all – so we work the best we can with that.
By having a great invoice program, you can automate your invoices to automatically send if they repeat, are detailed (especially for your hourly clients) and can ensure that the terms and conditions you agreed on are covered each time.
Never work unless you are paid, and have the process in play to collect in the worst case.
This sounds easy, but really – if you aren’t paid, and are wasting time working on a client plus trying to chase for the payment – you are leaving ACTUAL money on the table. This takes away from your other freelance and virtual assistant clients who pay each month.
Make sure you have a process in place that after no more than 5days past due, you stop all work and communicate with your client that no further work will continue until their invoice is paid in full.
If you don’t hear, then don’t worry about it – just shut down the work and move on to the other clients. If there are extras (i.e. specialty software etc you purchased for that client that are supposed to be included in the costs), make sure that you see how that affects your business and costs. In these cases, this is where month-to-month subscriptions are idea, as you can pause/cancel if they are not able to be used on other clients.
The biggest thing to remember in all of this, by being professional, clear, and having your needs (terms and conditions) in writing, it does eliminate any other confusion. The other piece to it is, have constant communication with your client over the month. If they feel that you care, they will care for you and make sure you are paid on time each month – as you prove your value and they cannot live without you in their lives and businesses.
What other steps have you taken to ensure you are paid each month? Are there any tips that we missed? Would love to hear in the comments below.