Being Late With Invoices Will Cost You A Person’s Trust
When your goal is to develop long-term relationships in business, the best place to start is to earn their trust. In the beginning of any business relationship, a small amount of trust is extended in good faith. It has to be for the relationship to get off the ground. Over time, broken agreements – especially small ones – contribute to the destruction of trust, making trust harder to build.
In business, the agreements most commonly broken have to do with meetings, payments, and project updates. People expect to be called back, paid on time, and provided with transparent updates. When commitments within these categories are broken, especially involving money, trust gets washed down the drain.
Commit to sending and paying invoices by a specific date
The number one complaint of freelancers across the world is not getting paid on time. There are plenty of reasons people put off paying freelancers. Most of the time it’s because they aren’t taken seriously. Unfortunately, the gig economy makes it too easy to be casual with documents, and when you’re casual with invoices, you don’t get paid.
Trust isn’t diminished solely by the person who makes a late payment. Both parties have a responsibility to set expectations and keep agreements regarding payments. The receiver of services can only pay on time when they’re given a proper deadline first.
The person who has to pay the invoice isn’t the only one that can compromise trust in a business relationship. The person sending an invoice can diminish trust by sending invoices at the last minute, without a deadline, or requesting an unexpected amount of money. Someone expected to pay a surprise invoice is going to trust that business relationship less, and that might contribute to having your invoices put off.
If you want to get paid on time, you’ve got to do two things: be clear with your client about how far in advance you’ll send their invoice (and be your word), and be clear about the date and time you expect to be paid (and promptly follow up if the deadline is missed). Not including a payment deadline on an invoice ensures it will be put off. If you’re too busy to redo your current forms, grab an invoice template preloaded with all the important elements that will help you get paid.
There will always be people who put off invoices even when you’ve been crystal clear with your expectations. Before you chase down those payments, remember that it’s not rude to request a late payment you’re owed. You’ve already performed the work, and you are entitled to be paid.
When you can’t be your word, acknowledge and recommit
Life happens when you’re making other plans. There will always be times when you can’t meet your agreements. How you handle these situations depends on how you’ve been trained. Most people get defensive and deflect blame by providing excuses, reasons, or justifications because they haven’t been trained otherwise. This type of response isn’t effective. A decent number of people have been trained to handle these situations differently where blame and defensive maneuvers don’t live.
When you can’t do what you’ve said you’re going to do, acknowledge to the other person that you can’t meet your agreement. Next, recommit to something new. For example, if your invoice is due next Thursday, but you don’t get paid until Friday, let them know as soon as possible and recommit to an alternative due date. It’s that simple. No blame, no shame, no excuses.
Trust is a transaction
Although it sounds like it comes from the heart, trust is actually a conditional transaction within a relationship. Your ability to trust someone is generally based on your ability to be certain about what they will and won’t do. For example, when you trust someone with the password to your email account, you’re fairly certain they won’t sabotage you. If you thought there was any chance they’d slight you, you wouldn’t give them your password, no matter how much you love them.
Trust, then, isn’t a gift from the heart, but is provided in response to evidence that someone won’t do damage with what you’re entrusting them with.
This transactional nature of trust is the reason most people believe trust needs to be earned. Most people want others to demonstrate their ability to be their word, at least to some capacity, before being trusted.
Nothing destroys trust like broken promises relating to finances. To build strong relationships, pay your invoices on time and provide specific terms when requesting payments from others. If trust is earned by being your word, (and it is), the simple act of sending an invoice when you say you will carries immense power.