Everyone looks forward to pay day. Sadly, it can be very frustrating for small and medium sized trucking companies to deal with customers who don’t pay their invoices on time — or at all. If your trucking business is dealing with this issue, here are a number of ideas on how to collect unpaid invoices from customers and improve your invoicing process.

Take proactive steps prior to issuing invoices:

• Establish both credit limits and payment terms with each customer before you begin working with them. Payment terms of 15, 30, 45, or 60 days are common.
• Use a reliable invoicing system to track when invoices are issued, with automatic alerts that trigger when an invoice is past due.
• Once an alert is received, establish a standard process for collection emails or phone calls to be made immediately.
• Create a straightforward invoice format. Make sure each invoice clearly indicates the amount due including any detention time and lumpers, payment terms, load number, and where to send payment, so there is no misunderstanding.
• Determine if you want to offer early payment incentives for customers who have been consistent in paying their invoices. Some companies will offer a small discount for payments within a certain number of days.

Issue accurate invoices systematically:

• Issue the invoice to the customer as soon as a job is complete.
• Select a specific date each month or day of the week for invoicing, so you don’t get sidetracked with other business.
• Schedule follow up calls to confirm your invoices were received, and give customers a friendly reminder of when payment is due.

Collect on late payments efficiently:

• Make calls to inquire about late payments, maintaining a calm and polite tone as you issue the request for immediate payment.
• Establish procedures for when to involve a 3^rd party collection agency, and if the benefits are likely to outweigh the costs.
• Establish credit terms for all customers, but be flexible enough to make term adjustments for customers who consistently pay late. If problems persist, it may be time to consider terminating future business with that particular customer.

As you establish consistent, effective invoicing and collection processes, your payments can be collected more efficiently to improve your cash flow. You may also consider using Advanced Commercial Capital’s non-recourse factoring service to get immediate payment for invoices. This ensures that collection efforts don’t become costly or interfere with your ability to run your business.