Running your own business is hard enough without clients ghosting you when your invoice arrives.
And yet, time and time again, we hear from social media managers who are struggling to pay the bills because their clients haven’t paid them on time.
In fact, in our recent survey of Social Media Manager Prices, we learned that more than 40% of participants had had problems being paid.
Thankfully everyone got their money in the end, but chasing late invoice payments is a stress you can do without.
That’s why, today, we’re walking you through the simple steps you should take to ensure you’re always paid on time – and what to do when things go wrong.
Getting set up for payment success
As busy business owners ourselves, we know how important systems and processes are for financial success.
Not only do they help us attract and win the right kind of clients – the ones who don’t question the fee and always pay on time – but they also ensure we don’t have to waste time chasing late invoice payments.
1) Don’t ignore the red flag
When you’re keen to sign a new client, it’s tempting to rush in and ignore the red flags. Don’t.
Before you agree to work with a client, always do your homework. Does their website look legit? What do their customer reviews say? What’s your gut telling you?
Listen out for alarm bells. Clients who ask for discounts or free trials, say you’re too expensive or offer performance-related pay are likely to become a problem down the line.
For more advice on spotting red flags, read our blog 7 Nightmare client’ red flags social media marketers shouldn’t ignore.
2) Get a money mindset
Many freelance social media managers feel uncomfortable talking about money, but that needs to change.
You see, when you’re open and honest about your fees, you send a message of confidence to your clients.
If, on the other hand, you’re embarrassed and apologetic about your prices, clients will assume you don’t take your business seriously. This can result in late invoice payments and scope creep.
We know money conversations are hard. But the bottom line is you’re here to grow your business and make money to provide for yourself and your family.
3) Get payment upfront to avoid late invoice payments
It’s standard practice for social media managers to be paid in advance, and this shouldn’t be something you’re scared to request.
Be clear about it in your messaging – in calls, emails, your social media posts and on your website.
The more you insist on it and implement it, the easier it gets.
If a client isn’t happy to pay in full upfront, we’d question whether they’re a good client for you.
But, if advance payment is an absolute deal-breaker, consider a 50% in advance agreement or 7-14 day payment terms.
Remember, this is your business – you get to do it your way.
4) Terms of Business
We recommend every social media marketer invests in a Terms of Business. Not only does it set professional boundaries from the start, but it also makes disputes easier to resolve if things do go wrong.
Your Terms of Business should include:
- The times you’re available to work
- Agreed deliverables
- The project fee (one-off or ongoing)
- Payment terms
- Overtime fees
- Additional work fees
- Rush job fees
- Late payment terms
- Cancellation policy
If your client is a limited company, you should also include a clause which holds the individual – rather than just the business – accountable for payment if the business were to go bust. A contract specialist will be able to help you with this.
5) Role model good money management
If you want to be paid on time, it goes without saying that you should invoice on time.
If you’re sloppy and disorganised requesting payment, your client will assume they can be too.
Have a standard invoice template or use the invoicing software that comes with your business bank account.
Your invoice should include all the info your client needs to pay you promptly, including your name, address, bank details and an outline of your work.
You should also have a follow-up process to check whether a payment has been made or whether you need to move on to Plan B.
6) Plan B. Chasing clients for late invoice payments
When you realise payment is late, a quick phone will often resolve the problem.
However, if that doesn’t work you'll have to step up your efforts to get paid.
We suggest having a pre-written sequence of emails ready so that you can deal with things calmly without the situation being clouded with emotion.
Email #1: Polite reminder that payment is overdue
Email #2: Reminder of your agreed Terms of Business and that interest will soon be added
Email #3: New invoice with late payment fees added
Email #3 Notice that legal action will be taken unless immediate payment is made
Email #4 Notice of legal action
There are laws to ensure freelancers aren’t left out of pocket. This government article explains how much interest you can charge
7) Attract better clients
Chasing late invoice payments, and worrying about how you will pay the bills, takes the joy out of working as a social media marketer.
We know you didn’t set up your business to become a debt collector!
And that’s why it’s so important you attract and win high-paying, respectful clients from the start.
Find out how in Your Dream Client Workshop