Every business dreams of ways to boost cash flow and ensure money comes in consistently and reliably. However, that isn’t usually the case, as there are far too many variables that can affect revenue streams. Yet there are some smart billing practices that your company can standardise as it scales for greater chances of timely payment from clients and customers. From implementing recurring billing cycles to rewarding early payment, here are some suggestions.
Embrace the Power of Automation
AI and automation can be your best friend for powerful workflows, productivity and even personal tasks. However, they are essential for business-related jobs that can help keep revenue stable and consistent. For example, you can subscribe to services that offer invoicing software to enterprises. With these tools, you can configure immediate invoices, reduce human error and set up reminders, all of which will help dramatically reduce payment times.
Implement Recurring Billing Cycles and DD
Income can be unpredictable, but there are a few ways it can become more consistent. If you operate a retainer or subscription-style business, then recurring billing cycles through direct debit can vastly improve cash flow and the reliability of revenue. This is because automatic payments reduce the need for clients to manually process transactions, and you get paid on the same day each month, vastly improving the predictability and visibility of incoming funds.
Boost Cash Flow with Shorter Payment Terms
In the UK alone, it is estimated that around 50,000 businesses have shut down because of the cash flow problems related to late payments. Of course, there are many smart habits that lead to financial freedom for a business, but there is an ace up your sleeve you may not have thought of. Shorter payment terms of around 7 to 14 days can keep things on track, especially as you scale. You can also demand a deposit for larger projects and invoice at milestones.
Reward and Incentivise Early Payment
Getting what you are owed when you are owed it is an expectation of any business. You provide a service, and you deserve to be paid for that service. However, even if a customer pays on time, being paid earlier gives you access to more funds upfront that can go back into the business. To ensure you get paid earlier than usual, offering rewards can be pretty effective. For example, some businesses offer a discount for early payment, and customers actually love this!
Make It Easier for Customers to Pay
There are numerous things that contribute to reduced business, such as abandoned shopping carts. One of the most overlooked is a poor checkout process, in particular, limited methods of payment. As a modern business, it helps to explore different payment methods that your customer base expects and will indeed use. For example, you can consider accepting digital wallets or even crypto in addition to common payment methods like bank cards and cash.
Summary
Subscribing to automated services for business processes such as invoicing is one of the best smart billing practices that will boost cash flow. Your company can also benefit from shorter repayment periods, and offering multiple ways to pay includes more potential customers.
