Tips and Tricks #16: How to charge your subscribers a late fee in Zoho Subscriptions
Charging late fees to your subscribers can be hard to digest, but sometimes late fees are necessary to run a healthy business. In this post, we'll be looking at how and why you might need to charge late fees for your customers in Zoho Subscriptions.
This post is part of a series of tips and tricks that we post every week. If you missed last week's post about bulk-updating your data in Zoho Subscriptions, go ahead and check it out.
Should your business impose late fees?
Imposing late fees on your subscribers is completely based upon your business practices. However, if you are faced with consistently late paying customers, then a late fee could be a good idea as it can help persuade your customers to pay their invoices on time. This, in turn, will allow you to maintain a healthy cashflow where you can focus on growing your business instead of worrying over missed payments.
If you do decide to go ahead with late fees, then here are a few pointers before you set them up:
- Let your customers know about your newly introduced late fee system well in advance--no one likes an unpleasant surprise.
- Send payment reminders with details regarding the late fee before their invoice is due.
- Don't overcharge the late fee and make sure to give your customers a sufficient grace period to pay off the invoice; this will help retain your customers' goodwill.
- Ensure that the late fee complies with your local taxation laws.
Setting up late fees in Zoho Subscriptions
Like many of our previous tips, we'll be using a custom function to achieve this. Here's how:
- Go to Zoho Subscriptions > Settings > Automation > Custom Function.
- Click + New Custom Function in the top right.
- Enter a name for the custom function and select the module as Invoice.
- Click Create Custom Events.
- Select the workflow type as Date Based.
- Set the execution date of the custom function as a particular number of days after the invoice's due date. Also, set the execution time, which specifies the exact time that the custom function would be triggered.
- Click Apply Advanced Filter.
- Add criteria to execute the custom function when the Status of the invoice is Overdue.
- Copy the script for this custom function, which can be found on GitHub, and paste it in the Deluge script editor.
- Click Save.
Now, whenever an overdue invoice is 3 days past its due date, this custom function will be triggered and add a one-time charge to your customer, which will be sent in a separate invoice. You can customize the late fee amount and the grace period to suit your needs by making small changes to the script.
Try it out and let us know how it goes. Have any other business scenarios you'd like to see us cover? Leave a comment below and we'll try our best to address them in future posts.
Cheers,
Varun Steven
The Zoho Subscriptions Team
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