There are many benefits to using cloud accounting software, such as value for money, time-saving automation and more flexible working, but did you know that it can help you to get paid faster, too?
Getting paid more quickly is one of the best ways to improve your cash flow and keep your business running smoothly, so don’t overlook this important benefit of cloud accounting software. Let’s take a closer look at how cloud accounting can help you get paid faster.
Tip #1 — Automated invoicing
If you want to get paid quickly then you have to get your invoices right. Preparing your invoices manually increases the likelihood of human error. Mistakes on your invoices can then lead to unhappy customers and a lot of unnecessary back-and-forth trying to fix the issue. This means that you’re likely to be waiting for longer for the money you’re owed to reach your bank account.
Cloud accounting software programs can automate your invoices for you, allowing you to send accurate invoices on time. Best of all, the invoice is emailed straight to your client’s inbox, so you don’t have to wait several days for them to receive it by mail.
Furthermore, if you provide your clients with a subscription service then you can set up your accounting software to automatically send recurring invoices. This ensures that your invoices are always sent on the correct date and it will save you time and effort, too.
Tip #2 — Track your receivables
It can be difficult to remember which of your clients owe you money at any given moment, and if you manually invoice them it may take a while to find out. This makes it more difficult to stay on top of your receivables and chase up late payments in a timely manner.
However, cloud accounting software enables you to see who owes you money with a quick glance at your dashboard and then you can take action accordingly.
Your clients are far less likely to pay you on time if they think that you’re forgetful and unlikely to follow up. However, if you consistently send them payment reminders and are prompt to follow up on missed deadlines, your clients will take your payment terms seriously.
If you notice that a client is frequently late with payment, it may be time to consider introducing late fees. Of course, you should give them plenty of notice that you are making these changes.
When the deadline is approaching, make sure to send them a payment reminder that clearly states the fees again so that they have time to cough up before incurring fees.
This will certainly incentivise late-paying clients to respect your deadlines. Best of all, cloud accounting software allows you to easily automate these charges so that you don’t have to do any complex calculations yourself, either.
Tip #3 — Shorter payment cycles
Many small businesses offer their clients 30 days to pay, but these generous deadlines may soon be a thing of the past. Back when companies had no choice but to mail physical invoices, 30 day payment cycles were necessary.
It would take at least a few days for the invoice to reach the client, who would then need to process the invoice and issue a cheque, which would then need to be mailed back to the business owner.
Now, however, thanks to the power of cloud accounting, 30 day payment terms are no longer necessary. It takes mere seconds for digital copies of an invoice to reach a client’s inbox and payments are electronic.
Therefore, consider leveraging the convenience of cloud based accounting software to shorten your terms and get paid faster.
Tip #4 — Easier for clients to pay you
Electronic invoicing makes it easier for your clients to pay you and therefore they are likely to do it far sooner. Cloud accounting software allows you to accept several forms of payment, including PayPal, debit cards and bank transfers.
Your clients simply have to choose the option that is most convenient for them and they can click a link to pay your invoice in full. Your cloud accounting platform will then identify each payment according to the customer and invoice number, ensuring that all of your records automatically stay accurate and up-to-date.