What Are Different Payment Methods My Clients Can Use?
Updated: Apr 18
Every business will have its own preferred method of billing customers and clients.
For instance, if you have an online shop with Etsy, you will use an electronic form of payment to bill the customer whereas if you offer services you might send an invoice or accept cash only.
One other method that is useful for businesses that offer service contracts to clients are setting up a recurring charge.
These kinds of charges can be completed manually or they can be done using:
An invoicing software (i.e. https://www.waveapps.com/" target="_blank">Wave)
Bookkeeping software (i.e. https://quickbooks.intuit.com/" target="_blank">QuickBooks)
CRM software (i.e. https://www.honeybook.com/" target="_blank">HoneyBook)
Other forms of billing can also use the applications mentioned above.
How To Know What Method Is For You?
When setting up or making changes to your business it’s important to stay consistent with your billing methods. This will not only make it easy for clients and customers, but it will also help you when it comes time to record all of the transactions.
If you are online, then you will more than likely use the payment method that is provided by the software you are using.
If you are in-store, then you will typically use the standard payment methods of cash, check, or card.
If you are a business that offers services that include online, in-person, or both interactions, then choosing the best payment practice for you might be a little more complex. One way to make the decision easier for you is by taking a look at similar businesses to see their payment setup.
Are they using invoices?
Do they use specific software?
Is it up to the preferred method of the client?
When Should You Bill Clients?
For businesses that provide products, the answer to ‘when should I bill my clients?’ is right away.
However, for businesses that offer services, it’s important to keep in mind what you would like your payment policy to be.
Some businesses prefer all payments to be done upfront before any work is done while others wait until the end for payment.
Depending on the structure of your business and the services you provide, you might even want to require a down payment initially and then the rest of the payment once the service is completed.
Keep in mind, that whatever method you choose, you’ll want to stay consistent for both bookkeeping purposes and to make everything easy for the client to understand.
Once your billing method and the way you would like clients to make payments are chosen, write everything up into a company policy and/or a contract. These policies can even include a section on a refund policy (learn more about refunds in our other blog).