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Starting an online business and taking on gigs from companies and private clients might be something you have been dreaming of for a long time. You were, however, not prepared for the financial struggle that comes with managing your finances.
It is now your responsibility to keep an eye on your finances and chase up payments. If you don’t have the right infrastructure, you might not be able to enforce payment schedules and get paid on time. Below you will find a few tips on getting your money quicker, and managing your cash flow.
Use Cloud Invoicing
To automate your financial management, you can use a cloud system for creating invoices. As soon as you have the work done for a company, make sure you generate and send the invoice. Based on your contract, you will be able to hold the work back until you get paid. You will be surprised how many excuses clients will come up with when you ask for a payment. If you are a starting up freelancer, and you have limited experience, make sure you visit support forums and blogs to learn the tricks of the trade.
Implement PayPal Invoicing
If you get paid by PayPal, you can create your invoices through PayPal. This will make your administration faster, and if your customer doesn’t pay on time, you can start a dispute and get paid, provided that you can prove that the work has been completed. You can also create monthly statement and check which payments are overdue. PayPal allows you to remind customers about the payments due instantly, by sending them an email. If you provide a monthly service, you can even schedule your invoicing, so you have more time to spend on productive work.
Debit Card and Credit Card Processing
You might offer flexibility for your clients, too, by allowing them to pay via debit or credit card. You can implement different payment processing systems, or sign up for a merchant account with Google Payments. The systems allow you to get paid instantly in your bank account or electronic system. If you work for clients that don’t have a PayPal account or cannot pay cash, you can issue invoices and send them to the cloud to be paid. You don’t need a physical card reader in most cases to get paid immediately. However, if you are a freelance photographer, it might be a good idea to get a card machine to make it easier for customers to pay in person.
You could get a cloud account management system that allows you to send out automatic reminders, without having to check on your clients and invoices. You can also get a statement of unpaid bills. Depending on where your customers are located, you need to have the legal framework to make sure you can enforce payment terms. While automatic reminders might not force your clients to pay on time, they will send out a strong message that you are aware of the bill, and have an organized system that keeps an eye on their payments. Sometimes this alone can improve your on-time payment rates.
Implement a Deposit Scheme
When you start working online and secure your first freelancer contract, you become self-employed, responsible for your own bills and finances. Many freelancers make a mistake of not checking their new client out. With different freelancing platforms online connecting clients with contractors, chances are you will never meet your customers. However, you can check their reputation, and ask about their company. You don’t want them to find a new excuse every week why they shouldn’t pay. If you are a freelance writer, never send the entire work over before you got the payment.
Send a screenshot of the text instead, or a snippet. Check out the terms of the contract if you work through freelancing platforms. Some companies don’t enforce payment terms and avoid being drawn into client-freelancer disputes. Stay away from these firms, as there will be no guarantee of getting paid at all. When you work for private clients, explain to them that as you don’t know them you will need a deposit to get started. If they are a reputable business, they will understand.
Use Watermark on Your Proof and Designs
If you are a freelance graphic designer working on online platforms or have your own website, it is important that you protect your intellectual property. You will be surprised how many people have lost money by sending the work over and never getting paid. There is some cheap watermark software available on the internet you can use to protect your work, still, show the designs to your customers.
Never send the final job over before you get your money. If you are a web designer, don’t send the entire template over, and don’t make clients’ sites live until you received the payment in full. Preventing non-payment is always cheaper than dealing with clients unwilling to settle their bills.
Create a Contract and Payment Policy
It is important that you disclose your terms and conditions with your clients before you enter an agreement. You might need to get help with creating your payment policy and contract terms, to make sure everything is covered. If your client provides you with a contract, make sure that you read it and there are no loopholes in it that allow non-payment. If you need help with contracting law and freelancing, you should talk to a legal professional at Slater Heelis to find out what legal protection you are entitled to as a freelance work when working as a contractor for companies.
Starting your freelancing career is challenging. You will get your first clients, get your head around using cloud computing, and manage multiple deadlines, just to find out that not all your clients are as honest as you are. Create a policy and put guarantees in place to get your money faster. Automate your invoicing and payment reminders, and communicate your terms clearly.