Although we would all like to blame our customers’ late payments wholly on them, it may be more productive to take a good internal look at construction invoice collection processes. This is especially true if it seems like late payments are becoming a trend among your customers. There is rarely a time when invoicing customers is fun, so sometimes we tend to rush through it. However, when construction invoice collection is made a rush job, we often forget vital information that could have gotten us paid faster.
There are some simple steps you can take to make sure your construction invoice collection processes are in top shape to get you paid faster.
1. Include Details
Unlike some other industries where you are simply billing for one good purchased, the construction industry has quite a few services that are often included in one invoice. It’s important to write out in detail on the invoice everything for which you are billing the client, from materials used to time spent on the project. The more detailed the invoice, the less likely a client will come back with a dispute.
2. Take Notes
When a client comes to you with a project in mind, make sure you take note of everything they’re saying – in writing. Often, a client has an idea in their mind of what they expect the project to look like when it is finished without fully conveying their vision and clearly explaining what they mean. Unfortunately, this frequently leads to an unhappy client who refuses to pay for all of the time, effort, and money you put into the project. Taking notes of what the client originally said they wanted can ensure that when you get around to the construction invoice collection process, you can settle your disputes faster.
3. Indicate How to Pay
This may seem like it should be extremely clear to clients, however, most people need the directions laid out very clearly. Your invoice should indicate to the client how to pay you, whether it is through a customer payment portal or via check. The deadline for payment should also be explicitly noted. Having a clear and visible due date is one of the most overlooked construction invoice collection mistakes, but the most easily avoidable.
4. Send Invoices Immediately
Don’t wait until a week before the payment is due to send out the invoice to a client. Have the invoice ready and waiting for when the project is finished and make sure it is directly delivered to the client. The longer you wait, the more likely your client won’t see the need to pay you in a timely fashion.
Some easy tweaks to your construction invoice collection process may be all you need to get paid faster. You could really ramp up your invoice collections by adding an automated invoice collection software, which can put most of these simple steps on auto-pilot for your business. By simply keeping more organized, the construction invoice collections process can become a breeze.
Interested in learning more about invoice collections and accounts receivable best practices? Visit Anytime Collect’s Resource Center for free white papers, case studies and more.
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