If you would like to automate the process, there are many different apps that you can link to your accounting system (i.e. Xero) and it will automatically search for any late-paying customers and send them a personalised reminder about their overdue payment.
Here are some of the apps currently available.
Chaser (works with Xero)
Chaser sends your debtors reminder emails that look like personal emails from you. Merge fields in your email templates bring in information such as the customer name, invoice number and amount.
You can create differently worded templates for use with different customers so that the wording is appropriate for each relationship. You could choose to have formal wording with some customers, and more informal wording for those customers you have a closer relationship with.
You can select which days of the week to send out your debtor reminder emails and if a customer has more than one outstanding invoice, the system is smart enough to include mention of each invoice in the one email, rather than send one email per invoice.
Chaser also makes it easy to see the history of payment reminder emails without you having to search through your inbox to work out what happened with a particular invoice. All invoice and payment-related information is displayed on the one screen.
Debtor Daddy (works with Xero, MYOB & QuickBooks)
Debtor Daddy lets you set up a series of reminder emails to automatically send to customers both before and after the due date.
You can base your reminders on a number of different (debt) “collectors” and then tailor the wording of the emails used by each collector. You can then assign different collectors to different customers which not only customises the wording of the emails, but also the number and timing of reminder emails.
Debtor Daddy makes it easy to filter your outstanding invoices on how overdue they are, and from the Hit List view you can action further communication, change Collectors, see what reminders have gone out and what’s due to go out tomorrow, this week and so on.
ezyCollect (works with Xero MYOB)
If you’d like to send emails and SMS reminders to late-paying customers, then check out ezyCollect. It also lets you set up postal and telephone reminders, send a pre-approved legal letter and escalate the debt to a collection agency. You can even perform credit checks.
It includes a schedule (and adds the phone calls you need to make to customers), graphs and reports to see how much debt you’ve managed to recover.
Late Fee Manager (works with Xero & QuickBooks)
If your Terms and Conditions include fees or interest charges for late payment, Late Fee Manager might be just what you need. As well as sending reminders to late-paying customers, it will calculate and automatically apply to the original invoice any late fees or interest charges.
This is by no means a complete list of what’s available. There are plenty of others, including InvoiceSherpa, xocashflow and Debtze. And they all offer a free trial, so you can try them all and decide which one will work best for your business.
**The material and contents provided in this article contains general information and does not take into account your personal objectives, financial situation or needs. It is not intended to be advice and you should not act specifically on the basis of this information alone. If expert assistance is required, please contact Peer Wealth on (02) 8014 7608.