Getting PAID is a challenge many business owners have – at all stages. As your business grows and expands, your needs will change, for many reasons. In this blog, we wanted to offer our tips for getting paid faster and reducing the need to chase your clients for unpaid invoices. Because I know y’all would love to spend less time chasing payment and just getting paid upfront, amirite?!
One way to get paid faster is to look at the methods you accept for payment: services like Stripe, Square, Afterpay. Are you offering the options that your clients and customers need? Or is there a more popular method that you may need to look into, to get your customers to hit that ‘Pay Now’ button faster?
Another hack that we use is to put the payment options on your quote – don’t put them only on your invoice. If you list all the payment options on your quote, people have an option to pay you earlier – whereas they may never have thought of that otherwise.
Another way you can save time and get paid faster, is by setting up reminders to follow up from invoices. The invoicing software you use will often have this feature so that you don’t have to spend time doing it manually. Xero is great for doing just this – you can set terms of i.e. 7 days, and a reminder will be sent out after that time period. You can also add in specific terms such as “Interest will be charged after X days”, or “Late payment fees apply after x days”, to encourage clients to pay faster. If you haven’t covered your butt and ensured that this is your terms and conditions – at the end of the day all is this is, is a scare tactic without any follow up.
While cash isn’t a common method of getting paid in many businesses, we had to mention it here – waiting for a meeting, or for cash to be paid can delay payment even longer. With the range of options for electronic funds transfers nowadays – we believe online payments are just a much more convenient option.
We’ve also seen business owners who only invoice once the work is done – and this doesn’t have to be the case. Depending on the type of work, you can choose to invoice upfront, and request payment be made before you commence work. Many other businesses work off a 50% upfront and 50% on completion framework. Others offer payment plans to spread the cost out, and also reduce risk for both parties. All of these options increase your chances of getting paid faster.
We’d love to hear your experiences and tips with these! Have you found any other methods for getting paid faster in your business?
Repeat after me: “a shoebox alone is not a solution”. Ok, look. I know lots of business owners do this – and it’s not the end of the world if that’s where all your receipts are stored right now. I’ve got a few tips up my sleeve to help you keep on top of them – and make tax time more about reviewing info, than spending hours going through your shoebox receipts.
First up – have a think about the systems you currently have in your business. What’s working? What’s not working? If you don’t have a system for your records already, it’s time to create one! Trust me, it’ll make your life a whole lot easier and feel much more organised– which is a great feeling! Perhaps you already have a system in place, but is it effective and saving you time? Sometimes systems can end up creating more work – which completely defeats the purpose! Your goal should always be to streamline and get it done faster and easier. If it’s a hassle, you’ll procrastinate on doing it too – meaning a build up of work (read: a stack of accounting to do, come tax time 😉).
One challenge we often see with clients is when business owners have a CRM, and an accounting system completely separate – and where these systems don’t speak to each other. In this scenario you’ll find that information is being duplicated and can get confusing – and instead of making life easier, you create extra work! So instead of just letting things go – take the time to evaluate what systems you have and if they are truly working in your business so that you don’t have extra to do later on.
Another big thing to pay attention to is whether your CRM is setup for GST. Some that were created by international organisations may not account for GST, and this can also cause big issues down the track if your invoicing is not accurate. Even if you aren’t at the stage of charging GST just yet, it’s handy to know that your CRM can handle it so that you don’t need to change systems when you do get to this stage.
Also a super important tip for record keeping in your business is keeping them for five years. These don’t have to be paper, they could be electronic. But, as a business owner you need to make sure you are keeping everything. That means, if you commit to taking photos of your receipts and load them into a system like Xero – it’s best if you do ALL of your receipts that way, rather than half and half.
Our last tips for record keeping is our personal preference – use an app where you can take photos of your receipts rather than keeping paper copies. This way you can ensure that it’s always saved, even if you lose the paper copies – or if the ink fades! There are some great apps out there like Receipt Bank. If you do want to keep the paper copies as well – make sure they are stored in one place – like a shoebox or zip lock bag. Our final tip is to separate your records by financial year – and we mean when the invoice was PAID, not when it was raised.
Phew! Implementing these steps will save you so much time and avoid headaches in the long run. Which will you start by doing next?
What I want to say to you is that one thing that you can definitely do to grow your business is to think about the customer experience. A business’ purpose is to get and retain clients, right? As a business without customers, you will not be in business. So, getting new customers and retaining your existing customers should be pretty much the focus of all of your client interactions, and what these client interactions are called, collectively, is the customer experience.
What worked for us
One thing I have really tried to build solid at Balance Tax Accountants is a great customer experience from the beginning. I didn’t inherit a business, I didn’t buy a client list, I created it myself. I started it from just me getting clients and growing from there. I’ve really tried to create a great customer experience, and I did that by thinking about all the different touch-points that our business comes across when it comes to communicating with our customers.
Balance Tax Accountants offer services. A lot of our services are online, some are in person, but basically one of the biggest aspects of the customer experience is our presence on social media, because that’s where people like, comment, direct message us, and email. My team and I have put a lot of effort into ensuring that we have a consistent and easy customer experience. We want to be able to communicate with our clients in a way that is easy and meaningful to them.
How can you create a good customer experience?
I’m going to tell you a couple of things that we’ve implemented in Balance Tax Accountants.
A year ago, I thought we had a great customer experience, but then we grew pretty large, pretty quickly. And so, every once in a while, you’ve got to stop and reflect on where you’re at, are you still delivering a customer experience that is on the same level as where your business is at now? Are you still delivering a level of service that you are happy with as a business owner and that your customers are happy with?
1. We implemented feedback forms
After every piece of work, or every job, is completed, we now send our clients feedback forms where we ask them how we did. We ask our clients things like: how was the booking process? Did you find it easy? How about the process that we have for giving us information to be able to do the work? Did you find that easy? Do you have any helpful comments, thoughts? Any good, and bad things to say? Any feedback you would like to give us? Areas we can improve?
Implementing feedback forms is a really easy way to gauge how you’re doing with the customer experience because you’re asking your customers directly. There is no guessing.
2. Scheduling Tools
We use a calendar for scheduling our client work. Whenever someone contacts us to book in work, if it’s recurring, then it’s scheduled in advance. We know the monthly work that happens and we have processes in place to make sure it happens the same for quarterly work. But let’s say things like tax returns, you only do those once a year, and you’re not necessarily going to do your tax returns the same month every single year – we have a process for this too.
3. Setting timelines, and beating them
One thing that we’ve done to improve the customer experience is when people contact us and want their tax return done, we ask for some information from them first. When they send it back to us, their job is scheduled in, and we notify them of the estimated wait time.
See what we’re doing? We’re hedging the client’s expectations of the turnaround of their work. The rule is that you always want to overestimate, so that way you under promise and over deliver. The worst thing you can do is over promise and under deliver, then the customer will feel start to feel impatient with you and loose confidence in your work.
But if we told them, “hey, your work is going to be done in about two weeks”. If we can get to it sooner than we will. When you deliver it to them a week and a half in advance they’re going to be like, “Oh, wow. I wasn’t expecting to get it until a couple of days from now. This is awesome.”
See how it’s so easy for you to kind of set your business up as the hero? So, those are just a couple of things that we’ve implemented in Balance Tax Accountants. Please have a think about the customer experience that you’re providing your customers, and what are some simple things that you can do to improve it.
Customer experience does not have to be expensive. The things we implement have not cost us another dollar at all.
A question I get asked a lot is when is the time to invest in accounting software?
In this day in age, there’s not really an excuse for a business owner not to have a system in place because there’s a lot of affordable options, from free to fancier paid options. I am a firm believer in when you’re starting a business, cash flow is limited and so any time you want to spend money it’s important to make sure that you’re getting a return on investment, right?
Either the money you’re spending is going to help you grow, get more sales, or streamline your processes. This is the theory I like to apply to the question in answer. When you’re running a business you need to keep business records to track your income and track your expenses. How else will you know how much profit you’ve made without a system in place?
How else will you know what you’ve spent money on to grow your business? How else will you know if you’re charging enough for your products and services? These are all answers that can easily be obtained if you have accounting software that allows you to run reports to see the inflows and outflows of cash in your business. So first I want to talk about a free option.
There’s one called Wave. Wave is a great software if you’re just starting out and don’t really have the money to invest in a more robust paid option. It will connect to your bank feeds and does a lot of the same things as the paid options except for once you get to the point that you need to register for GST in Australia, it won’t be able to help you. This is because it’s an American program, and GST is an Australian thing. But eventually, as your business grows you’re going to get to the point where you’re going to have to register for GST and you’re going to hit that $75,000 in sales threshold. At this point, it’s definitely worth considering spending the monthly subscription fee in order to get on a paid software program. There’s a lot of choices out there. The one I am the biggest fan of is Xero. I am a Xero advisor and Balance Tax Accountants is a silver status partner; what this means is that we do a lot with Xero!
Xero is great because it keeps your business finances organized and it gives you the ability over time to run reports to track the status of your business so you can actually see trends. You know the question, “How’s business?” and the default yet truthful answer of “it’s busy”. How great would it be if instead of the run of the mill reply, you can actually say, “hey, you know what? Last month I have had my best month in sales”, or, “I’ve cut my overhead expenses by 10%”. Isn’t that amazing?
That means I’m making more profit by putting in the same amount of effort into my business. It’s invaluable when it comes to growing your small business. It’s imperative that you keep on top of your number, and a cloud accounting software can help you do just that.
Another great feature that Xero has is it can connect to apps. There’s a huge movement in the cloud accounting space to connect to apps that are industry specific.
Some apps that Xero supports are Stripe, PayPal, Receipt Bank, Spotlight Reporting, Workflow Max, Harvest, and a lot more.
When do I know that it’s time to get help? The amount of work has gotten to the point that you can’t handle it on your own, and you’re not able to deliver the level of customer service that you are happy with for your business.
Now, I am a big fan of outsourcing. It’s one of the very first things that I did. As an accountant, I did something that’s a bit different from traditional accounting firms, and that is the first thing that I outsourced was marketing.
I knew that I could be the best accountant in the world, but if my marketing did not tell people that I was the best accountant and that I was available to accept new work, nobody would know. Nobody would get to experience the awesome skills I have, that I can share with them to make their businesses and their lives better, right?
So the first thing I did is I outsourced marketing. I outsourced marketing before I could even afford to do it. Now, I’m not saying that you should spend money that you don’t have, but what I am saying is that, if your goal is to grow and scale your business, it will have to be bigger than you.
When you have gotten to the point that you’ve decided that you need to get help, what should you outsource? There’s a lot of ways to go about doing this, but a couple of tips I can give you is: Number one, know your strengths and your weaknesses.
The first thing I would do is sit down and write a list. What are the things that you enjoy most about your business and what are the things that you enjoy the least? What you’ll probably find is that the things that you enjoy the most are what you’re good at because they’re easy for you. So when you’re deciding what to outsource first, it might be worth considering outsourcing those things that take you a long time to do or that you don’t necessarily enjoy.
Another tip when it comes to deciding what to outsource is to write it down and make a list of all the activities of your business. List everything from getting new customers to servicing existing customers to completing admin, marketing, maybe appointment scheduling tasks, and assign a dollar value to each of them.
Things like getting new customers, those would definitely be worth the highest dollar value. Things like admin, answering e-mails, scheduling appointments, organizing onboarding paperwork, those are tasks that would be less dollar value.
As a business owner, your time is best spent doing the high dollar value tasks. Why is this? Because nobody is going to be able to draw new customers to your business like you will be able to. You have a passion, you have a fire inside of you for your business, and people are going to be able to see that and identify that when they hear you speak about what it is that you do, right?
So those are the types of things that I would prioritize your time for. I would look at outsourcing those that are either on your weaknesses list or that are low dollar value tasks.
Remember, if your plan is to grow and scale your business, then it must become bigger than you. This means your vision must be bigger than yourself. Also, you have to have systems and processes in place that will allow the workflows to occur and be assigned to different people and to allow different roles to be completed within your business.