Your business is growing, your customers love your work and your competitors are noticing. Increase cash flow and customer satisfaction by simplifying your billing and collection processes.
Imagine sending your invoices one day earlier and collecting those invoices two days sooner; significantly increasing cash flow. Rethink your processes and realign staff to shorten the billing and collection processes.
Your invoice communicates and reflects your company’s performance to your customer. Your invoice is part your customer’s project costs, which in turn are reported to their customer. Your entire organization must understand the importance of invoice accuracy and timeliness. How do you feel when you get an invoice that you know is wrong and getting it corrected is not easy?
- Start with an improved mindset – set high standards for billings and collections. Your staff will say “industry average is 60 days …”, do not accept average – your customers won’t.
- Timesheets must be submitted, reviewed and approved by 10 am the first business day after the end of the timesheet period.
- Post your timesheets, generate project cost reports with provisional rates – at the end of each timesheet period.
- Project cost reports must be reviewed and labor corrections made after each labor posting.
- Batch or macro processing within your system should be used to quickly generate project costs reports as soon as labor is posted.
- Labor corrections must be completed immediately. The sooner an employee understands the corrected charge, the higher the likelihood they will remember the corrected charges in the future.
Ask you staff to review your Billing Process – “we always did it that way” is not a process. Does the current process make sense? Are we properly communicating with our customers? Would a simpler process provide accurate invoices sooner? Again, utilize batch or macro processing to eliminate errors and save time.
Confirming accuracy improves customer satisfaction, calling or “chasing” a late payment creates tension and resentment.
- Align timesheet end dates with month end – for example, the 15th and end if the month.
- Inform billing staff of new projects to generate new charge codes.
- Invoice electronically
- Confirm receipt of the invoice and ask if there are any questions
- Confirm invoice acceptance
- Grace periods are used for important customers only.
- Confirm staff is not using them to avoid dealing with late customers
- Customers who continually to pay late should be contacted early to confirm payment
- Invoice flat amounts separately.
- Flat amount invoices (i.e. monthly SaaS fees) can be sent earlier and will not delayed for labor billing questions
- Work with customers who proactively reach out about delayed payments
By understanding the invoicing and collections processes, you can better understand how your staff can support growth and project staffing needs.
Gaining a new client is much harder than retaining a current customer. Retain more customers by improving your billing and collection process
Please contact me directly with any questions – firstname.lastname@example.org
RETHINK – your billing and collection processes