Three Rules to Faster Payments for Your Small Business

In April 2012, The Freelancer’s Union launched the site “The World’s Longest Invoice” website; the goal of the website was to highlight how many freelancers are unable to collect on debts owed them by deadbeat clients. In just over a week’s time, the total of the invoices listed exceeded $15 million dollars.

Want to know how many times IndigoTea (my company) has been stiffed for services? None. That’s right – zip, zero and nada. Would you like to know the three rules that have ensured that enviable payment rate? I’ll share them with you here.

1) Get it in writing. It doesn’t matter if it’s your best friend, your favorite uncle, or a random stranger – the minute money’s involved, get it in writing  We use a third-party service for contracts. It’s an invaluable means of having the ability to track down information later in the project, with the document being held and tracked by an impartial third party.

2) Get a deposit. For most projects, our deposit is 50%, to cover any ancillary expenses during the design/development/testing/deployment phases. Include the terms of payment agreed in the contract on the invoice. This way you’ll be able to demonstrate that both parties agreed to the final terms, due to acceptance of the initial invoice. This leads to #3.

3) Invoice online. This is the giant-killer, the thing that can help keep your business in the black. In years past, a project might have been started (or delivered) with the assurance of “the check is in the mail”, or “we’ll get Accounting right on that.”, only to find that your invoice is buried in a stack on someone’s desk, while they’re out on sabbatical, or worse yet – the client’s broke, and you’re out of luck for months of work.

With today’s electronic invoice options, there’s no reason to wait weeks or months to get paid. Here’s a list of options available for today.

1) PayPal Invoicing – this is the least expensive option in terms of start-up and monthly costs, though PayPal charges a per-transaction fee (2.9% + $0.30 per transaction). All you have to do is have a PayPal account; if you configure your account to not accept e-checks, and get the free PayPal ATM Mastercard, you can access your payments instantly.

2) Intuit Merchant Service for QuickBooks – If you’re already using QuickBooks, this might be an option for you. At $19.99/month plus 2.47% per transaction, it’s a bit more of an expense. In addition, it’s ACH-based, which means your payments will still take 3-4 days to be available after being processed.

3) Direct integration into your own website – for mojoPortal (a .Net-based content management system) customers, there’s Web Invoice Prowhich allows your clients to pay directly at your website; available payments methods include and PayPal.  For WordPress users, there are add-ons like Web Invoice for WordPress or WP-Invoice.

Online invoicing cuts down payment time, and dramatically decreases your exposure to the risk of non-payment.

(Originally published on


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