I hope this finds you and your loved ones in good health.
As we are witnessing, the COVID-19 pandemic has started taking a toll on businesses of all types. Here are some useful tips that could help you streamline your invoicing and AR processes to keep your business healthy.
1. Communicate clearly with your customers:
During this period, transparent communication with customers is a necessity. A lot of businesses have started displaying messages on their home pages, explaining their BCP (Business Continuity Process) and other important announcements they want to convey to their customers.
As an additional means of communication, you can use the banner message in the customer portal of Zoho Invoice. The banner message is visible in the home page of the portal, so it can help get the customer's attention quickly. You can set up this message under Settings > Preferences > Portal.
2. Relax the deadlines for estimates and invoices:
Your customers' priority at this moment will be keeping their family and loved ones safe, which might mean your estimates get accepted a little later than usual. Same goes for your invoice payments. Instead of bombarding the customer with multiple reminder emails, you can relax your policy and push back the expiration dates and due dates of your estimates and invoices.
To push back the dates on individual transactions, you can simply edit and make the changes. However, you can also perform this action in bulk (for up to 25 transactions in one go). Here's a screenshot that explains the steps:
You can follow the same steps in the Estimates section to update expiration dates in bulk.
3. Be approachable:
As a standard business practice, you might have set up automatic payment reminders in Zoho Invoice to go out on specific days before or after the invoice due date. However, given the current circumstances, you can definitely expect delays in payment.
Since you have control over the content that goes out in these reminder emails, think about rephrasing it to let your customers know that if they need any assistance, they can reach out to you by phone or email. This way, your finance team doesn't have to wait and wonder whether the customer will make their payment or not, or spend time sending extra emails. You can tweak your reminder email content under Settings > Reminders.
By making it easy for your customers to approach you and treating them on a case-by-case basis, you can actually bring down the number of unpaid transactions.
Let's say you have done this and have clearly stated how your customers can contact you. Now, what responses can you expect from them?
a) "I might not be able to pay the full invoice amount on time."
b) "I might not be able to pay the full invoice amount at all."
c) 'If you can offer me a discount, I can pay now."
Tips 4, 5, and 6 can help you handle these cases efficiently.
4. Enable partial payments for invoices:
Rather than waiting for your customers to be able to make a full invoice payment, you can encourage them to make partial payments for invoices so that you can have a steady cash flow. If you are collecting payments online, you can enable this option while creating or editing an invoice.
If you collect payments offline, you can convey this information through the 'Terms and Conditions' field on the invoice.
5. Offer discounts:
By offering discounts on your outstanding invoices, you are proving that you care about your customers enough to give them a bit of a break. If you don't see the option to apply discounts to existing invoices, please enable it under Settings > Preferences > General.
6. Write off invoices in special cases:
If you've extended the deadline for a payment, but your customer has really run out of funds and won't be able to make the payment any time soon, you can waive the invoice so you can move ahead with your accounting.
Since written-off invoices turn into bad debt, use the Bad Debt report in the Reports section of Zoho Invoice to make sure you're not accumulating too much.
7. Increase the credit limit for loyal customers:
If a customer has been with you for a long time and is sticking with you during this period, an increased credit limit is a good way to thank them for their business. By increasing their credit limit, you are letting them know that you continue to want their business. The option to set a credit limit is available when you create or edit a customer profile.
Though some of these tips might have a negative effect on your finances temporarily, they can gain you long-term benefits like customer loyalty and customer retention, which will help your business recover more easily.
Did you find these tips useful? Can you think of some other best practices that businesses can use to get through difficult times? Let us know in the comments.
Note from Zoho: If you need any assistance regarding Zoho Invoice, our support team is available 24 hours a day, Monday-Friday. You can also reach out to us through email (firstname.lastname@example.org), live chat, or phone. Because Zoho recognizes that our own customers may be facing difficult times right now, we have rolled out an Emergency Subscription Assistance Program (ESAP) to help small businesses through this crisis. Learn more about this program.
Take care and stay safe! We'll get through this storm together.
Customer Relations | Zoho Finance