Ensuring payment for work is one of the biggest challenges many small business owners face. That’s why people ask for a portion of their invoice to be paid upfront as a deposit. Now FreshBooks has introduced a new, easier way for you to accept deposits on your invoices.
Starting today you can request a percentage of your invoice be paid upfront as a deposit.
Why Should I Care?
Waiting for your clients to pay you can be a stressful exercise in patience – you think they’ll be good for the money – but if they aren’t it can be exhausting chasing them to finally pay up. Allowing your clients to make partial payments online helped, but allowed your client to potentially dictate how much they wanted to pay.
Things are now much simpler for both you and your client to make a deposit on your invoice since you get to specify the amount to be paid. Now it will be crystal clear for your client how much they owe you – and that’s important for a lot of reasons:
Reassurance for you and your client
It doesn’t happen often but every once and a while someone in a business relationship flakes – either you never get paid for the work or a client never gets the work they expected. A deposit helps establish you as a legitimate business, showing that you’re serious and helping to build trust with a new client. A deposit also ensures that you get paid for at least some of your work should your client have trouble paying afterwards.
Keep the cash flowing during those long projects
It’s really exciting taking on a big, longer term, project – they allow you to flex your muscles and really showoff your skills and they often come with a big pay-off at the end. The only trouble is if you wait to invoice and collect all your payment at the the end of the project, it may have been weeks (or months) of no income. Requesting a deposit at the beginning of the project helps you make sure you have enough cash to see you through until the end of that big project. You can spend more time focusing your energy on your craft and less time worrying about your cash-flow.
You don’t have to cover the cost of materials out of pocket
Sometimes you’ll need to buy supplies in order to complete a project, and sure, you’ll be reimbursed for them once your client pays their invoice, but in the meantime you have to cover the material costs out of your own pocket. If you request a deposit at the beginning of a project you can use that money to cover the cost of supplies. Your money stays – where it belongs – in your wallet.
How Does it Work?
The next time you create a new invoice, you’ll see the option to request a deposit at the bottom of that invoice.
Once you click “Request a Deposit” you’ll be able to enter the percentage of your invoice you would like paid upfront.
Once you send your client the invoice they’ll be informed that they have a deposit due. This is what your client will see when they open the invoice:
Once the deposit has been paid the invoice’s status will change to Deposit Paid and your client will be able to begin making payment against the remaining invoice balance. This is what it will look like on your side when you look at the invoice.
Can I request a deposit if I don’t get paid online?
Absolutely, the invoice you send to your client will still have the deposit amount listed on it. When you receive the payment you would just apply it to the invoice like normal.
If I also allow my clients to make Partial Payments, will they be able to pay only a portion of the deposit?
No, if a client is paying online they will be required to pay the full deposit amount. Once the deposit has been paid though, the client can make partial payments against the remaining invoice balance.
Begin Requesting Deposits Today
Head over to your Invoices tab and, when you create a new invoice, try requesting a deposit. Your cash-flow will thank you.
Need a hand getting started? Don’t hesitate to shoot us an email, give us a call at 1-866-303-6061, or let us know what you think in the comments!