One of the biggest challenges for contractors today is that they have trouble getting paid after completing a job. Once the job has been done and the contractor has possibly even gone out of their way to do additional work for the customer, it’s time to pay for the service and the customer is suddenly hard to contact. What is a contractor supposed to do when a situation like this arises? It’s not exactly ideal to spend time and effort trying to track down your money from a customer. While it can be easy to put all the blame on slow paying customers, sometimes contractors can’t get out of their own way and are part of the problem when it comes to receiving payment. Depending on how you run your business, there can be many barriers when it comes to getting paid, so let’s look at how to simplify things.

Establish clear terms of payment in the contract

Before you even begin a new job, a contract should be created for both you and the client that establishes all of the terms and conditions for the job. This is a great way, right from the start, to communicate the payment terms to the client so no questions will be asked later. Having this in writing will make your life a whole lot easier down the road if the client turns their back on you.

Accept a variety of different payment methods

We all love to get paid in cash, but sometimes that’s not convenient for customers. With the amount of technology available today it’s possible for contractors to accept many different forms of payment rather than the old school wad of cash or a check. Most customers prefer paying with a credit card, so having a solution lined up to accept credit cards via a mobile device would help ensure you get paid ASAP. If your payment terms are set up as “due upon receipt” you can basically guarantee that you walk off the job site with full payment in one form or another if you are able to accept credit cards.

Create invoices that are clear and easy to understand

If your invoice is not clearly presented and it’s difficult for the customer to even find the amount they owe you, I’m sure you can guess – it will be a challenge to get them to pay you. If you’re still creating sloppy hand-written quotes or are using a free invoice template, you run a higher risk of having this happen. You can easily eliminate this barrier by using invoice software that is able to create custom, professional invoices tailored to each client. Sounds simple, right? It is. You will save yourself time down the road by not spending extra time trying to explain your invoice to clients or arguing over details of a hard to read a handwritten quote.

Invoice quickly

It is very important to get the client an invoice for the service immediately after the job is complete. By doing this so quickly, the job will still be very fresh in the client’s mind. You don’t want to sit and wait on sending an invoice for a client to possibly forget about the job. This, in return, will make it even less likely that the client will pay you or have the funds available. If you’re not diligent about invoicing quickly, you’re setting a poor example for the behavior you expect from your customers as far as making their payment.

Offer incentives for early payments

Who doesn’t like getting a discount on a service? Incentives are a great way to motivate your clients to not only pay on time but pay earlier to save some money. Customers will always be more likely to act upon giving a payment when there is something in it for them. This could be done by simply knocking a certain percentage off of the total invoice if the client pays within a specified amount of days. It may cost you a couple of dollars up front, but it can save you from the hassle of tracking down late payments and improve your cash flow.

Keep in contact with clients

This one is important – get to know the clients that you are working with and regularly check with them regarding the progress of the job and their satisfaction with your work. This will keep you, and your work, fresh in their minds which will make it harder for them to forget that they owe you money. Even a simple “thank you” email will suffice as a friendly reminder after a job is completed that they still owe you money.

Protect yourself

At the end of the day getting paid is about protecting yourself and your business. Requiring a down payment before you begin work can be an easy way to make sure you don’t get hung out to dry. Unless the customer is financing your work, requiring a 30% to 50% down payment helps your cash flow and provides a better assurance of final payment upon completion of the job.

Doing all the easy things help you guarantee prompt payments from your customers. Otherwise, liens, small claims court, and even police reports may be necessary when your customers try to get away with not paying you. You always hear about the homeowner that got ripped off by the contractor but BEWARE, there are a lot of homeowners who try to skip out on the final payment with the contractor because they don’t think you will do anything. Protect yourself upfront!

The right tools can help

No business owner enjoys chasing around customers asking for a payment. The bottom line is if you make the payment process user-friendly and easy for your customers, the easier and more likely it will be for you to receive a timely payment. To make your life easier, invoicing software like JobFLEX can streamline your processes and reduce nearly all these barriers to getting paid.

JobFLEX allows you to create your own customized and easy to read invoices and estimates in seconds from a mobile device, and lets you clearly state your payment terms up front. If you offer an early payment discount, or you require a percentage of payment up front, you can add that to your estimates, along with a note saying that payment is due on receipt. When you finish a job, you can pull up the estimate on your mobile device and quickly turn that quote into an invoice and get it to your customer before you leave the job site. With the JobFLEX invoice app, you can knock down payment barriers for your customers which will make their lives easier while making sure your bank account stays health.

Try a free trial of JobFLEX or sign up for the paid version using the link below.
Get JobFLEX free on Google Play!

Share This