Accounts Receivable Best Practices: How to Get Paid Faster
Revenue that's been earned but not yet collected is one of the most common sources of cash flow stress for small businesses. The work is done. The invoice is out. And the money is sitting somewhere in your client's accounts payable queue instead of your bank account. Here's how to change that.
Invoice Immediately — Every Time
Every day between completing work and sending an invoice is a day your client's payment is delayed by your own process. Build a habit — or a system — that ensures invoices go out the same day work is completed or delivered, not at the end of the week or the end of the month. In QuickBooks, you can set up recurring invoices for retainer clients so this happens automatically.
Set and Communicate Clear Terms
Your payment terms should be clear in every invoice and client agreement. Establish when payment is due and communicate those expectations before work begins. For recurring clients, consider offering incentives for early payment when appropriate. Clear terms help prevent misunderstandings and make it easier to maintain healthy cash flow.
The A/R Aging Report Is Your Collection Tool
Your Accounts Receivable Aging report shows who owes you money and how long invoices have been outstanding. Review it regularly so you can follow up before overdue payments become a larger problem. A consistent collection process helps you stay on top of outstanding balances and protect your cash flow.
Require Deposits on Large or New Client Work
For larger projects or new client relationships, consider requiring a deposit before work begins. This helps protect your cash position and establishes clear payment expectations from the start. Your payment terms should reflect the scope of the work and the level of trust in the client relationship.
Make It Easy to Pay You
The more payment options you offer, the faster you get paid. ACH bank transfer, credit card, Zelle, QuickBooks Payments — reduce friction wherever possible. A client who has to write and mail a check will pay slower than one who can click a link in their email.
Accounts receivable management is a discipline, not a personality trait. The businesses that get paid fastest aren't the ones with the best clients — they're the ones with the best systems.
📞 Need help setting up your A/R system in QuickBooks and building collection processes that work? Kindred Financial Services can help. Call (512) 521-0945 or visit www.kindredfinancialservices.com.
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