Most service professionals list invoicing as one of their more enjoyable activities, because it’s like a monetary “pat on the back.” While I certainly understand the elation of cutting a large invoice, I personally avoid it whenever I can.

Once again, I’m expanding on the August 6 tip, “Psychology 101,” which points out that you should always consider the potential downside to each contact you have with your clients, and eliminate as much negativity as you can.

The purpose of an invoice is to inform the client that money is due, and establish or confirm payment terms, such as amount and due date. And while your clients may love the results you produce for them, I doubt they actually enjoy paying you once you’re finished. So, how can you eliminate the negativity your clients experience when you ask them to cut checks?

First, an analogy.

Think back to the last time you purchased a new car. You were sitting at the dealer, reviewing the final forms. All the negotiations were over, and you were either confident you got a good deal, or pleased that you bought a Saturn and didn’t have to negotiate at all. The only thing left was to sign the contract and write the deposit check.

I don’t know about you, but I’ve experienced this several times, and writing that check has always been a great feeling. After all, the act of paying the deposit is the final step to putting my new car in my garage.

Now it’s two years later, and you’re doing your monthly bills. Your kids just “bankrupted” you with back-to-school clothes and supplies, the house needs a new roof, and, worst of all, the new-car smell is a distant memory.

Writing your 24th car payment check sucks big time. Doesn’t it?

Eliminating Negativity

Here are four ideas for turning the negativity your clients feel when paying for your services into positive experiences.

1: Ask for (or require) payment up front.

The exact wording I use on long-term engagements less than $25,000, or short-term engagements of any amount, is:

Payment in full is required to book the engagement and lock in the dates.

Just like the deposit on a car, this turns the payment into the final act of “purchasing” the results your clients want.

On long-term engagements over $25,000, the wording changes to:

Half of the project fee is required to book the engagement and lock in the dates, with the balance due 45 days after the project begins. In addition, a 10 percent discount is available for payment in full up front.

There are two things to note in that wording:

1. The second payment is due 45 days after the engagement start date. This is a hard date, not based on some approval process or deliverable met.  
2. The 10 percent discount is more than worth it to me, because it eliminates my need to cut an invoice and makes my cash-flow situation better. In addition, it adds a positive experience – saving money – to my client’s act of cutting or authorizing the check.

When a client chooses the “half in 45 days” option, I recommend cutting the invoice as soon as the proposal is signed, with the due date set to the 45-day date. When you send it, include a handwritten note that says something like:

Joe,

I’ve marked the enclosed invoice due on November 13, 2001, which is 45 days after our project start date, as we agreed.

If you choose to pay it within the next two weeks, you can still have the 10 percent discount. Just cut the check for $XX,XXX, instead of the amount indicated on the invoice.

Gill

You’ll be surprised at how many checks you get within two weeks. And even when they don’t take advantage of your offer, you still offered something of value with the invoice itself, which helps to reduce the negativity receiving an invoice creates.

2: Send the invoices directly to an administration person.

Ask your client for the name and address of the admin person who will be processing the invoices, so you can send them directly to him or her. It’s likely your client will still need to approve payment, but at least you saved him or her the trouble of having to open the invoice and forward it. (It’s not much, but every little bit helps.)

3: Pay your own expenses, such as for travel.

The worst invoice that can be received is the one sent to recover travel expenses after an engagement, because travel expenses don’t produce results for the client. To avoid sending these invoices, I always provide at least three options for doing business in my proposals.

In the low-end option, travel expenses are billed as incurred, meaning the client will receive invoices. In the middle and high-end options, it states that I will cover my own travel expenses.

Quite often, executives will choose the middle or high-end options simply to avoid having to justify travel expenses to upper-level executives.

4: Ask your client whether he or she wants to arrange your travel on your behalf.

In many cases, your clients will have internal people who arrange travel all the time. And not only will you avoid invoicing, you’ll often get better accommodations than you would have selected yourself. (I even let clients know that I prefer bed and breakfast locations if they’re available. I always have a great trip when I’m booked at a B&B.)

I’m sure there are more ideas that would also work. The point, again, is to eliminate the negative and accentuate the positive, in every client contact situation.

Have a great week!

Gill