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cash flow throughout the project’s duration, had a chance to review. It can be a good idea
ensuring that your financial stability remains to also send a follow-up email to confirm that
intact and allowing you to allocate resources the phone conversation took place and create
efficiently. a dated paper trail.
Moreover, it fosters transparency and trust If you have still not received any payment after
between you and your clients by aligning chasing the client, send them email reminders
their payment obligations with the delivery and follow up with a telephone call. Many
of agreed-upon results, creating a win-win accountancy software packages can automate
situation for both parties. email reminders for you, reducing the admin
burden. Be firm, cautious of excuses, and
Ensure contracts are clear from the press your client for a date of payment.
outset
Before commencing any work, it’s worth If payment isn’t forthcoming, be prepared to
ensuring there is a clear contract in place act decisively and explain the consequences
between your business and the client. Without of non-payment to your client. For example,
a contract, chasing a non-payer is much more you could contact your customer in writing and
challenging from a legal standpoint. inform them that you will be exercising your
statutory right to claim interest (which is set
Be sure to state your payment milestones at 8% over the Bank of England base rate),
and invoicing terms, including due dates, as well as compensation to cover the debt
late payment interest or fees (on business- recovery costs.
to-business debt if applicable), and accepted
payment methods, as this helps set Speak to your insurer to see if they can
expectations upfront. help
Always check your insurance policy to see
Have a system in place for chasing late if it includes legal help. At Markel Direct, we
payments provide our business insurance policyholders
It pays to have a thorough system in place with access to a 24 hour legal advice
for chasing payments. On the day a payment helpline, as well as access to Business Hub,
becomes overdue, you should contact the which contains legal document templates
client directly over the phone. to help with late payment problems. Having
access to valuable advice from experienced
Try to keep the conversation friendly and legal professionals can help you navigate
professional, as there may be a reasonable challenging situations and give you the best
explanation as to why the invoice hasn’t been chance of getting paid quickly.
paid. Simply state that there is an outstanding
balance and ask if there is a reason why the Reach out to a professional mediator
amount has not been paid. Try to agree a date or Small Business Commissioner
when the payment will be made, but if your In our study, one of the most surprising
client is unable to give a date straight away, findings was that only 4% of respondents
say that you’ll call the next day once they have said they consulted the Small Business
6 November 2023
