Unpaid Invoices: 7 Ways to Professionally Deal With Late-Paying Clients

Here are seven strategies for dealing with overdue payments and unpaid invoices from clients, something many small business owners have to deal with at one point or another. Nobody likes having to chase down clients to get paid for the work they’ve done, so we asked business owners what strategies they have used to get paid on time and with minimal hassle. For our complete guide, visit:

Our video covers:

Strategy #1: Send your invoice right away. 00: 40

Sending your invoice right after providing a good or service can increase client responsiveness and keeps you top of mind for the client.

Strategy #2: Let your clients pay you online. 01: 32

Providing several payment options, including online payment options, reduces the friction around payment.

Strategy #3: Ask for an upfront deposit. 02: 06

Asking for an upfront deposit ensures that you get at least a portion of the payment that you’re entitled to. Once the client has invested money, they’re more likely to follow through with full payment.

Strategy #4: Offer early payment discounts, and charge late fees. 02: 54

Early payment discounts incentivize clients to pay an invoice well before the due date. For clients that need an extra nudge, late fees can also act as a deterrent to late payment.

Strategy #5: Create a drip campaign of reminders. 03: 58

Sending regular client reminders reduces overdue invoices and late payments, and you can automate things with an email marketing drip campaign.

Strategy #6: Do your homework on prospective clients. 5: 05

One of the best ways to prevent late payments is to work only with clients who value timeliness. Check with other vendors to see whether a particular client tends to pay on time. You can also check the client’s business credit report.

Strategy #7: Escalate the issue if needed. 05: 54

Finally, you can take legal action against a client who hasn’t paid an invoice in over 90 days. Retaining a lawyer to write a demand letter on your behalf can often produce the desired result, minus the time and expense of actually going to court.

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