Customer payment reminders are a vital operation for any thriving business that wants to continue succeeding over time!
Experienced or beginner entrepreneurs, take note now of how to carry out this operation according to best practices.

Customer payment reminders: what are we talking about?

Customer payment reminders are one of the essential tasks of any well-organized entrepreneur. It involves re-contacting your customers when they haven't paid their invoice (balance due or deposit). An operation that may seem simple at first glance, but which must be done correctly to avoid numerous short or long-term damages to your business. Indeed, unpaid invoices or invoices paid but too frequently late, can have serious consequences - such as a deficit in cash flow - preventing you from investing in projects or even simply meeting the basic needs of your business. This is why reminders must be done properly, in other words using a customized methodology.

Why is reminding all customers the same way a mistake?

Customer reminders are one thing, obtaining payment for an invoice while maintaining a good relationship with your customer is another! That's why it can be interesting to personalize your approach based on your customer's profile. It won't be about handling case by case, but rather categorizing your customers according to situations. Ask yourself the right questions:

• Is this a customer regularly late with payments? Regular reminders will be necessary and also done early;
• Is this a loyal and good-paying customer who exceptionally forgot a payment? A simple email reminder should suffice;
• Is this a brand new customer who doesn't respond to any of your cordial email contacts? A reminder by mail and phone will be essential;
• Is this a customer with whom you share a more or less important contract? The reminder can be done by phone, properly worded, so as not to lose this commercial contract;
• Or is this a customer who finds themselves in a bad position? It will be essential to make the reminder by phone, to clearly discuss the situation and the possibilities of full or partial invoice recovery.

Thus, even if it's very unpleasant for you as a business owner to have to remind your customers to be paid for your work or merchandise, it's important to keep your cool. The reminder must be done with as much psychology as possible, so as not to ruin your client portfolio, and thus not lose most of your contracts. Invoice collection is unfortunately an unavoidable element of an entrepreneur's daily life.

How to write a customer reminder letter?

If you opt for a written customer reminder, paper or digital format (email), make sure to specify all of the following points:

• the invoice concerned by the reminder (identification number, creation date, or even sending date);
• the amount due (if deposit already paid, specify the deposit invoice elements and the remaining amount due)
• mention late fees and remind payment deadlines;
• a clear, concise and courteous note with your customer;
• a scan or photocopy of the invoice concerned may be attached.

→ Always keep proof of your paper or email reminders.

Is there an ideal time to carry out this process?

Except for bad payers, it's preferable to avoid reminding your customers too early, where some of them might get into the habit of paying only after reminders! You also shouldn't wait until D-day of the payment deadline, to give your customer time to initiate payment. Notifying the customer a week before will allow them to pay you properly, without thinking that you're trying to get late penalties!

What behavior to adopt with said customer afterwards?

Once the invoice is collected, don't close the file without putting on the finishing touches! Courteously thank your customer by email or mail, to maintain a good customer relationship. All these steps often help retain customers, but also make them get into the habit of paying you even faster, no doubt to compensate for the payment delay of the invoice that could have potentially become disputed.

Moreover, when you've remained on good terms with a customer who had undergone a reminder, don't rush them at the next billing. Either they pay on time, and that's a good thing. Or they seem to forget payment again, and in this case make a reminder always a week before the deadline. No need to remind them too early, where an awkward situation could be created.

Only if over time, they persist in paying late, then you can actually make customer reminders slightly earlier than for other cases.

Factoring, a solution that will spare your cash flow and your nerves!

Enjoy income commensurate with the work done

As a reminder, factoring allows you to get payment for your invoices without depending on customer payments. Thus, when you invoice a customer, your factoring company pays you the amount invoiced to the customer during the month for a small percentage of the invoiced amount. The company is directly reimbursed by the customer payment. At the end of the month, you can thus pay yourself income based on actual work, and not based on paid invoices. As a result, factoring will allow you to gain stability in terms of monthly income.

Save time by outsourcing your customer reminders

This solution will also allow you to save time. Customer reminders are a delicate operation, sometimes lengthy. That's why entrusting such a process to an expert in the field can be extremely interesting for you as a business owner, customer reminders and insurance against unpaid invoices being generally included in the fees.

Maintain vital cash flow

Factoring can concern all your invoices or only a part, you decide, according to your needs and expectations! Your cash flow being thus kept afloat or at least at the level of work done and/or sales made, you can therefore invest in equipment or any project essential to your business, without the uncertainties of customer payments.

Maintain peace of mind without the uncertainties of customer payments!

The problem of customer payments, accompanied by seasonal drops in activity, can be a barrier to personal projects, such as a mortgage. Factoring will undoubtedly prove to be a gigantic advantage in your banker's eyes. Moreover, it will be easier to "disconnect" from your activity during your free time, if the payment of your invoices is assured!

And you, have you ever had to remind one of your customers? Did this article answer your questions? Don't hesitate to come test our online invoicing software for 15 days. If you have questions or need tips, you can also contact us.