By offering flexible payment options, you can manage slow-paying homeowners and avoid a cash flow crunch.
With the busy season creeping up on us, you’re going to start working more leads, attending more appointments, and installing more projects (all good things!) That being said, it only makes sense that your remodeling company will need to spend more cash on expenses, like fuel for company trucks, labor, and products and materials. But what happens when all this cash is exiting the business, and a homeowner decided to take their sweet time paying you? You become strapped for the cash that pays for employee salaries, taxes, inventory and operating costs (yikes!)
How to Effectively Manage Late Payments
It doesn’t take a rocket scientist to figure out that you need enough cash coming in to cover the expenses needed to run your business, yet so many companies fail for this exact reason. Fortunately, there are several proactive things you can do to ensure you’re paid in a timely manner for the work you perform and keep your cash flow steady. Before the busy season rolls around, consider taking the following actions at your home improvement business to deal with slow-paying homeowners:
1. Use a Mobile Payment Processor
Collecting payments with a mobile payment processor enables your team to accept payments in the field when they’re on-the-spot with a customer, ultimately getting you paid faster and cutting down on paperwork. Ideally, you should look for a payment processor that can integrate directly with your other business software. For example: PaySimple, a payment processing platform, integrates with improveit 360’s industry-specific CRM system so that home pros can accept payments from the same application used to store their lead and customer information. And by housing all of that payment and customer information in one place, you can spend less time on data entry and more time on your business! To learn about how a current improveit 360 customer has used PaySimple to seamlessly manage their customer payments, read this case study.
2. Create Online Payment Forms
By creating online payment forms, your customers will be able to pay their invoices 24/7, instead of just during a 9-5 window when your business is open. And with the improveit 360 + PaySimple integration, you can easily create configurable, personalized payment forms that allow you to accept credit card and ACH payments while you sleep. Plus, your customer will ultimately have a better experience with your business if they’re able to submit payments when it’s most convenient for them.
3. Set Up Recurring Billing
To avoid chasing down payments or subsequent payments, it’s a smart idea to set up recurring billing. And with improveit 360’s integration with PaySimple, you can securely store customer payment information and seamlessly collect subsequent payments. As a result, your customer won’t have to worry about calling in every time a payment is due, and you won’t have to worry about customers being late with payments. A win-win in our book!
4. Charge Late Payment Fees
If a customer is going to be late on their payment, you might as well benefit from it! By including a late payment fee in your customer’s contract, the homeowner will be more likely to make payments when they’re due to avoid paying more money. Just be sure to review any terms around late payment fees so you aren’t blindsiding your customer with further charges.
The harsh reality is that slow-paying homeowners exist in nearly every industry, but you can take measures to reduce late payments and maintain your cash flow. By using the combined power of improveit 360’s industry-specific CRM system and PaySimple’s payment processing platform, your home improvement business can simplify payment acceptance and securely accept large sums, down payments, multi-step payments or recurring payments from anywhere, at any time.
To learn more about how improveit 360 and PaySimple can help you manage everything from leads to payments to projects to everything in between, schedule a demo with one of our team members today.