Profit Fix #4: Got Stacks in Unpaid Invoices and Clients are Often Late to Pay?
If you have hundreds of unpaid invoices sitting inside your accounting/CRM software right now and clients are late to pay their invoices…
We’re going to walk you through how we've been able to collect over half of unpaid invoices within 90 days for clients and partners, and reduce disputed invoices from 50+ every month for a particular service account to just a few. To get there, we first need to get a few things off the table.
When invoices are taking five to seven days (even WEEKS) to go out, what is likely to happen?
It’s normal that a lot of those will get disputed and paid late.
“What was this part for?”
“Why are there two truck rolls for this?”
“Wait a second… The tech was here for only one hour. Why did I get billed for three?”
And so on.
And, not only that…
Go and try to get the technician to remember why he or she needed that part two weeks ago, or why there was a second truck roll, or why it took three hours instead of one.
It’s a drag.
No wonder disputes take an average of 12 to 21 days to get solved.
On the other hand, we’re aware that many disputes are just “business games.” Sometimes clients will dispute invoices simply because it buys them another 30 days.
But we bet company executives prefer that their clients play money games on a Monopoly board and NOT with their business’ money and cash flow.
And, after processing over a MILLION work orders, here's how we've been able to collect faster for our clients and shrink the number of disputed invoices to the bare minimum:
Sending invoices within 30 minutes right after the tech updates the work order status to “completed.”
While memory is still fresh.
Not only is memory still fresh, but any potential errors are still fresh as well.
If there’s any legitimate error, say in freight charges, tax, parts, warranty, etc., we resolve it on the same day! Not weeks after.
Sounds too simple, but we can count on one hand the Field Service executives that are pushing for this. One of them is industry pioneer Rodger Smelcer, who enjoys same-day invoicing with us. As a result, he’s had clients go from 50 rejected invoices per month to barely any and took United Service Technologies (UST) to being a “low hanging fruit” for disputes to a tough nut to crack.
This invoicing change alone added six figures in cash flow every month for United Service Technologies. Not to mention all the added costs associated with disputes that are now slashed, like:
techs tired of getting their work questioned
managers thinking they’re doing something wrong (while it’s not true)
As you can see, the more “meta” benefits—beyond those extra dollars every month—are also HUGE for the team and clients.
So, it begs the question:
Why does it even happen?
Why would invoices take 5-14 days to be sent out in the first place? Out of experience untying this knot for our partners, we’ve found a couple of common reasons.
➊ Outdated practices & SOPs. Back in the days where software and automation were non-existent, maybe invoices were allocated weeks to be sent simply out of necessity. It used to be a little nightmare trying to get the info back from the techs, to get part references, and so on, but nowadays, all of that can be available in a few clicks.
➋ Staff is wearing multiple hats and juggling 2-3+ other responsibilities. So, maybe companies have caught up with technology and have all they need to send invoices on the same day… IF ONLY they had the headcount and the bandwidth to do it. But with no dedicated staff for it, invoicing still gets pushed till the end of their shift and to later in the week.
So… What could be another (much better) option?
To do what Rodger did, and have your remote team handle it. Having a global and remote team handling invoices for UST is what got them from seven-day invoices to real-time. Heck, sometimes invoices are even sent TOO FAST! And we’ve had to slow it down.
Isn't that a much better "problem"? And one that puts more dollars in the bank while keeping your billing team focused on higher-value tasks. So while you may not be able to change the payment terms of your clients, you CAN change how quickly they get your invoices.
If they pay in 30 days, no need to make it 37.
At Origo, we can help growth-minded mid-market industry executives recover the profit leaks from slow invoices. We help you slash disputes, too, by bringing a dedicated remote team to handle your invoices, no matter how “complex” your current billing process is, or which CRM you use, or how many SKUs there are.
And that’s just one of the specialized remote programs that we are bringing to reshape the industry. If you want to know if your company is suffering from a profit leak or two, click this link: