In this guide, you'll learn how to prevent super high accounts receivable balances, how to send emails that get you paid, and how to handle collection phone calls.
Preventing high A/R
Get all the information when you take the order
Ask for the A/P details if you're contact is not paying the invoice
Require payment up front
This seems like a no-brainer.
Qualified customers shouldn't have any issues paying a deposit or in-full.
Offer discounts for upfront payment or 2% 10 Net 30
Even if this is just an artwork deposit, collect something up front.
Make it stupid easy to pay with credit card or ACH
If you don't currently offer your customers an easy way to pay you online, stop reading this and go solve that problem.
Stop offering terms to just anyone
Fire bad customers
Some customers eat up all your time...and PROFITS.
Hit them with the finance charge stick
Sometimes the threat of finance charges is enough to get them to pay.
Emailing customers for payment
How to use these emails
- Make sure you change out the brackets [ ]. It’s poor form to leave those in there. We used those as placeholders of what to include. Depending on how you send these emails your invoice or email software can auto-populate variables.
- Rewrite them in your own voice. Change them to fit your shop, your style, your way of speaking. You can keep the same structure, but by rewriting them - you’ll make them yours.
- Write like you talk. Don’t go back to 10th grade English class when you write collections emails.Write like you were having a conversation with them. Picture them in front of you.
Power User Tip:
Use a mail tracking extension for Gmail [Gmelius, MixMax, or others] to know if your clients are opening these emails or not. You can also create canned templates that make it super easy to use the emails below.
Email 1 Your initial “pay me” email
Payment for your [project]
We were thrilled that we could help you with your order. I hope that you are 100% satisfied with your experience and the final results.
I’ve attached a copy of your final invoice. As discussed, the balance due is $ [amountDue].
You can pay online here [onlinePaymentLink] or just give us a call to pay with a credit card over the phone.
Thank so much for your business. We look forward to working with you on the next project soon.
Why this works?
The email is polite and friendly but still uses a business tone.
The language is not super strong so that you won’t come across as demanding.
It’s got all the needed detail and nothing more.
Email 2 The due date is approaching
Have you seen this?
I know you’re super busy but I wanted to make sure this didn’t fall off the radar.
Just a quick reminder that the payment for you [products] is due on [dueDate]
I wanted to make sure you didn’t get dinged for the 2% late fee after [dueDate]
I’ve attached the invoice as a PDF.
And you can pay online here.
Why this works?
You’re being more personable than the first email. And it seems like you’re wanting to help them out - by avoiding the late fee.
Avoiding pain is a huge motivator for people.
Email 3 The invoice is past due
Hi [firstName] - we really enjoyed working on your project. And we delivered as we agreed.
So I’m a little confused by your delay to pay your invoice that was due on [dueDate].
It seems like you’re not willing to pay us promptly for work that you’ve already received.
We’d love to work with you again on the next project. But unless we get paid in next few days, I’ll be forced to think twice before helping you on any projects in the future.
Why this works?
You’ve sent two emails already with no payment and the invoice is now past due.
Time to bring in the hammer. Give up on the business-y politeness and make an emotional appeal.
And on to the bonus email...
Email 4 They’ve ignored every other email
Have you given up on paying your bill?
Why this works?
Short - sweet - but bold.
At this point you’re just looking to get a response from them. You want them to respond back with a “No”. That’s obviously not a “Yes, we’ll pay you now.” The “No” brings them back and gets them focused on
We adapted this one from Chris Voss, author of the bestseller - Never Split the Difference. Highly recommend his book BTW.
Still didn’t get paid?
If after 3-4 emails you’ve still got no response or no payment, it’s time to pick up the phone.
Don’t assume the worst. You’ll feel like an asshole if you come in swinging and you learn that they truly didn’t get your emails. You want to be friendly and give them a way to save face.
Refer to your emails. ”Hey I’m just calling to check in about payment for the [products]. We sent a few emails about it. I just wanted to make sure you were receiving them because we didn’t hear from you.”
Follow up your call with an email. Remember to close the loop and summarize what you talked about on the call.
Calling customers for payment
The do's and dont's of collection calls
- Call before the invoice is due.
- Introduce yourself and why you're calling.
- Get frustrated or emotional.
Sample call script to use
EMILY: We didn’t receive invoice #123…..
YOU: We sent a copy in the box with your order; did you receive your order?
I am just sending it to you attached to an email right now, can you check your email?
Be prepared for objections and excuses
I didn't receive the invoice
The price doesn't match our (PO, quote, etc)
Waiting on the check to be signed
Can't pay it today
Services to help you get paid
These are the most popular payment providers on the internet. They usually connect with your invoicing or accounting software to allow customers to pay you directly online.
Automated A/R and collections
These tools will connect to your accounting software and automatically send statements and reminders to customers with open invoices.
For large orders or projects like wraps or signage, offering financing for clients can be a great way to make it easier to buy from you. Plus you get paid by the finance company.