“The check is in the mail.” Virtually every small business owner has heard this excuse at least once from a customer with unpaid bills. And while it’s an “oldie, but goodie,” collecting payments from customers is one of the most important concerns business owners face when managing billing for their companies.
Getting paid is the lifeblood of any small business, the function that makes possible everything else small business owners do. Yet, efficiently billing customers – and getting paid faster – is a chronic concern for SBOs, and the current economy has only made it worse.
The average small business carries $1,500 or more in overdue invoices from month to month, according to a survey by market research firm Decipher Inc. In this economy, that kind of backlog can be ultimately fatal for a small business. Efficient billing makes it easier to bring in cash, as without cash there is no profit and no way for a business to pay its own bills.
Simply finding the time to create and issue invoices can be a challenge. And getting customers to pay promptly once they receive the invoice is another.
For many small business owners, the answer to these concerns is online billing and payment acceptance. Processing automated clearing house (ACH) or e-checks and credit cards through online tools can streamline the invoicing process and allow customers to pay their bills quickly and easily. About seven out of 10 households are already paying bills online through banks and billers, according to a 2010 study by Javelin Research. And Generation Y customers prefer to pay bills online directly at biller websites.
A recent survey of small business owners by American Express, which offers AcceptPay, an online payment acceptance and invoicing tool, indicates that SBOs feel they get paid faster when they are able to provide customers with the payment format they want. Being able to accept credit card payments online is a top priority, they say.
To make billing easier, an online tool should:
* Accept both credit card and ACH payments
* Enable a business to accept payments online, via phone, or in person.
* Provide the ability to establish recurring billing and payment plans.
* Deposit customer payments directly into the business owner’s account.
* Allow for customization of invoices.
* Generate automated reminders for customers when their bills age beyond 30 days.
* Provide on-demand reporting that provides a complete view of funds.
Automated recurring billing and the ability to accept payments online can be particularly useful to businesses. Customers whose invoice amount remains the same from month to month can be placed on an automatic recurring billing system – allowing the business owner to concentrate on other matters, rather than generating the same invoice every month. The system also allows business owners to set up automatic payments, so a customer’s credit card or bank account can be charged with the recurring amount every month.
AcceptPay offers recurring billing and online payment acceptance, as well as a host of other features, for one low, all-inclusive monthly fee. Users are able to accept customer payments using all major credit cards and ACH, have payments deposited directly into their bank accounts, and integrate their online billing activities into Quickbooks, a popular accounting program among small businesses.
Billing will always be a necessary chore for small businesses. And while online billing and payment acceptance can’t completely erase all worries, it can help reduce the time business owners spend on invoicing – and ensure they will never again need to hear the phrase “the check is in the mail.”
