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Tutorial | September 15, 2021
Securing Late Payments From Clients and Customers Without Burning Bridges

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Payments are your lifeline when you’re a contractor or small business owner. Unfortunately, as you have probably discovered personally, customers are infamously stingy when it comes to making timely payments. In fact, it’s more common for them to be late than on-time – Business Wire says, 62% of all small business payments came in late in 2019, and 57% in 2020.

To survive and, indeed, thrive, it’s integral you learn how to secure payments from recalcitrant clients – without alienating, offending, or tarnishing your reputation. Remember, most of your clients will be tardy by default, and you can’t afford to cut them all off.

The Smartify Apps team offers some targeted advice, based on our collective experience:

Put yourself in their shoes#

When a payment is overdue, you must remain calm and objective. Being triggered and making demands over the phone or email is the fastest way to alienate clients. Instead, take a deep breath and consider the situation from their perspective. It could be they are busy, have forgotten, have financial constraints for the time being, or are dealing with a personal problem. If you’d like to build and maintain a long-term relationship, give them some breathing room.

Communicate with politeness and tact#

Next, you should follow up with a friendly reminder, preferably over the phone. Rehearse what you’re going to say in advance. Keep your tone friendly and understanding but firm. State the facts – a payment was due at a certain date, and the deadline is approaching or has passed. Don’t insult them personally, or inquire as to why they didn’t pay. If you’d prefer to write an email, draft it at night and then look at it again in the morning to make sure you aren’t confrontational before hitting send.

Communicate your expectations#

Always communicate your expectations, regardless of which medium you choose. Something along the lines of “I’d appreciate it greatly if you paid by…” works well, as does “We are expecting a payment from you …, according to our agreement”. Do inquire after their health and wellbeing, and let them know you’re available to answer questions. Put the ball in their court and then give it time.

Communicate with multiple people#

Unless you’re dealing with an individual, you should always attempt to talk to multiple people. For example, if you’re dealing with an organization, you should be working with multiple people. Letting one or more of them know about the due payment is more likely to be noticed. Further, it puts pressure on the person responsible for making the payment, as their reputation might be affected due to the delay.

Set up an early reminder system#

Typically, most of us make at least a dozen minor or major payments every month. It’s easy to lose track of what’s due when and where. That’s why many service companies send out reminders about payment due dates ahead of time – usually a week in advance and on the day the payment is due. Adopting this strategy is an excellent idea, as it’s non-confrontational, professional, and non-resource-intensive.

Offer to set up a personalized or flexible invoicing schedule#

Some clients have trouble with making large, one-off payments and prefer to make a small series of payments instead. Others don’t want to make payments on a fixed date monthly and prefer to do it on their own schedule instead. If your clients are trustworthy and have consistently paid you over time, you should consider offering to set up a personalized or flexible payment structure to fit their needs.

Automate your invoicing process#

Automating your invoicing process with software has multiple benefits, which Zenbusiness discusses here. First, it lifts the burden off your shoulders. You don’t need to be involved with the technicalities of payment collection, like sending clients payment links. Second, you can set up automatic invoicing to avoid being late. Finally, you can offer clients multiple convenient payment options. If a client can play with a couple of clicks via their favorite medium of payment, for example, you will likely be paid on time.

Pause work#

What if the client doesn’t pay you even after a friendly reminder or two? Consider pausing work on their project. If the work is important enough, they’ll be inconvenienced or lose time and money. Delays are enough to cause anyone to sit up and take notice. A simple, polite email communicating your intentions about starting back up again as soon as you’re paid is a good idea.

Reward your customers#

Depending on the nature of your business, you could reward customers who pay early or for multiple months in advance. For example, many cell phone companies offer a free extra month of service for customers willing to pay in advance. You could offer a discount on your product or service for the early birds and score brownie points with them while doing so. CSM offers several creative incentive ideas.

Try the carrot-and-stick approach#

The rewards-consequences approach sometimes pays dividends. If you can incentivize clients to pay early, you can also set up consequences for late payments. If clients know a late fee is due – and exactly how much interest they’re accruing by delaying – they’re more likely to pay on time. Make sure to include a mention of the late fee when you send out your usual reminders.


Perfect clients don’t exist, people do. Keep your expectations in check when dealing with them. Be savvy with your payment policy. Set firm boundaries while staying polite and respectful. People always respond better to humble requests than stern warnings or threats of dire consequences. It’s possible to remain professional but still keep the pressure on by being persistent and following up.

Of course, sometimes you will encounter problem clients who refuse to pay, no matter what. If this happens, explore your legal options like small claims court or collection agencies. It’s more than worth your time to learn the ins and outs of payment collection, and how successful businesses manage their clients. Having a good process going will result in a sustainable, solid business long-term.

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