Freelance recurring billing presents a new way of paying freelancers. In the past, clients have paid freelancers by milestone and on an hourly basis. These days, clients and freelancers can devise several ways of paying the amount that appears on the freelancer’s invoice. The industry has now accepted freelance recurring payments as a genuine and legal way of settling payments between the two groups. Under this method, clients spread payments rather than settling it all at once.
For the most part, clients and their freelancers usually agree to spread the payment into:
Freelance recurring payments are also known as subscription payments.
This form of payment offers clients the level of convenience they need to run their businesses well. They are able to select a way of paying that does not interfere with other aspects of the business. It offers them the flexibility needed to take charge of issues regarding freelance payments. However, it is not only advantageous to clients. Freelancers too benefit from this form of payment. It ensures freelancers are paid right on time. Through this method, clients pay invoices automatically the moment they receive the document.
Freelancers who will enjoy freelance recurring payments include:
There are several benefits to embracing freelance recurring billing, as you will learn below.
First, it minimizes a lot of the work you would normally spend most of your time doing. It reduces your legwork thus enabling you to dedicate more time to other important stuff. All that is required is to set the payment schedule up the first time. Afterward, you can manage changes in the amount or type of payment as you go. You can customize its details or content based on each client you get. Its effectiveness is due to many reasons. One of these reasons is the fact clients pre-determine their preferred billing dates.
After establishing the system, all you have to do is to wait for money in your business account.
Freelance recurring payments are also effective at reducing late payments. As most freelancers know, late payment is a huge problem. Research shows the number of freelancers who struggle with late payments has been going up in recent times. In fact, the problem is too common to the extent that 10% of all freelancers struggle paying rent or mortgage. Close to 37% of freelancers turn to their families to come to their aid financially. Wouldn’t it be great to reduce these scenarios by ensuring that late payments become a non-issue for freelancers?
Late payments affect business cash flow negatively.
The problem is too stressful to an extent more freelancers charge late payment fees. By doing this, freelancers hope to discourage their clients from making late payments. Problem with charging late fees is the client-freelancer relationship often suffers a dip. With an automated recurring payment system, however, payments arrive in the freelancer’s account on time. With this problem reduced significantly or eliminated, freelancers can continue operating smoothly because nothing interferes with their cash flow.
As previously stated, late payments can affect the relationship between a client and freelancer. In this regard, freelance recurring payments play a significant role by ensuring that nothing interferes with this relationship. The awkward conversations freelancers had with their clients regarding late payments will be no more. The system saves freelancers the energy and time they would have spent talking about late payments. The fact freelancers never have to worry about envelopes and stamps is an added advantage too.
With the conventional billing systems, clients and freelancers experience a few hardships in their relationship. However, that strain always improves, and a significant change is witnessed as the two parties embrace freelance recurring payments. One of the complaints with the old, conventional system is the difficulty of sustaining healthy relationships. The client-freelancer relationship experiences the severest strains. Often, freelancers have a difficult time maintaining customers. That also changes with the new payment system.
Freelancing involves a lot of costs and wastes too. Freelancers would prefer a system that allows them to save money and reduce wastes. Freelance recurring payments or billing offers them the opportunity of doing just that. First, this payment system is electronic. As a recent research showed, electronic billing systems enable businesses to save between 40 cents and 50 cents for each bill. Consequently, a business that sends around 20 invoices per year can save roughly seven pounds of paper each year.
In addition to that, the business will help reduce greenhouse gas emission by 171 pounds.
The business also helps to release 63 gallons of wastewater.
What is more, the business reduces the consumption of gasoline by five gallons.
How secure is the payment information that you run? As all freelancers know, payment information needs to remain secure at all times. The client’s payment details need to remain uncompromised. Otherwise, word will soon get out that the freelancer’s system is unsecure, which could hurt the freelancing business. Managing customer information all hinges on the how secure the system used is. The fact the freelance recurring billing system does not rely on paper already eliminates the possibility of unwanted parties duplicating sensitive information.
The absence of paper trail eliminates at least one intermediary between clients and freelancers.
Freelancers operating in industries where it is possible to replace manual systems with automated processes should be the first to embrace recurring payments. Making such a switch will produce outstanding results. The cash flow will improve significantly. The staff will enjoy the switch and improve productivity. Customers will also benefit from these improvements. Added to this is the fact the environment will also benefit greatly. The business will benefit from enhanced security too.
Higher customer retention is one of the benefits freelancers can expect from the new system.
How professional does a freelancer wish to appear? All serious freelancers understand the importance of creating and maintaining a professional image. No matter how small or young the freelancing business is, freelancers can approach their clients safe in the knowledge the new system demonstrates their professionalism adequately. The fact the system reduces the freelancer’s carbon footprint is an added advantage too at a time when the need for keeping the environment green is more urgent than ever before.
What is more, the new system is easy to set up.
It has auto-reminders, which help to eliminate the issue of delayed or delinquent payments.
Additionally, the system is compatible with some of the most popular platforms, such as:
The freelance recurring payment system is ideal for wide-ranging businesses. Therefore, it is good for most freelancers regardless of the industry they operate in. The fact it is gaining newfound acceptance universally by more users makes it the best choice for freelancers in most industries too. It serves freelancers who run subscription-based services well. It is the best system for freelancers whose businesses are involved in auto-delivery services. Freelancers who offer training materials and educational content will also love this new system.
The freelance recurring payments system is a great tool for making cash flow less unpredictable. What you get with it is a system that works like clockwork. Furthermore, you also have access to a system that guarantees payment, which is good news for your cash flow problems. With this system, freelancers can calculate their income with surgical accuracy mostly because of the specific timeframe under which it operates. With this information, freelancers can predict future earnings and growth of the business too.
It pays to learn the strategies you can implement to make cash flow more predictable.
Freelance recurring payments save time and money.
How much manpower do you need to generate the normal invoices each week, month or whenever they are due? Freelancers will tell you they spend a lot of money mailing invoices to their clients. They will tell you about the incredible costs they incur while processing payments too. With these payment systems, however, freelancers can cut their expenses by as much as 60%. What this means is more money in their pockets for other equally important stuff they need to do to keep the business moving forward well.
Freelance recurring payments are automated systems, as previously demonstrated. Unlike the ordinary systems, it removes the need and use of reams of paper. It eliminates the use of and reliance on manual bookkeeping. You never have to worry about manual accounting tasks, as long as you embrace this automated system. The automated system simplifies your work greatly. It ensures that you are able to send out invoices on time, receive payments in a timely manner, and record all payments on schedule without as much as lifting your fingers.
The system also saves you money owing to the fact you never have to worry about repairing broken printers, faxes and other office equipment you rely on to print and send invoices. Constant printing and sending of documents using the office equipment can cause extensive damages that cost you more money to repair or replace. That would not be good news considering how hard you work to add the extra dollar to your pocket. Profitability does not suffer when you use the automated system.
First, you have to identify a system that provides the solutions your business needs. No two recurring systems are similar. Each system has its pros and cons. Therefore, take your time to study the system you think will offer the solutions your freelancing business needs. After selecting the right system, let all your clients know about it. Keep your clients informed about the new system you will be using. Show them how to set up a similar system on their side, so you are all on the same page.
Before you begin using the new system, check if you have set the following:
You may need to customize it depending on the number of clients you serve. After all, you will not charge all your customers the same rate. Each time you get a new client, customize the system by filling it with fresh details for this new one. However, none of that will be important if you fail to follow PCI compliance. An example of this is the fact you cannot store your clients’ credit card information. Instead of credit cards, you would be better off with tokenization system, eChecks, or other similar alternatives.
Efficient payment systems can help your business with its marketing campaigns and goals. You may be wondering how this happens. Well, when clients interact with a business that believes in making the payment process as smooth and painless as possible, they cannot stop but only share that experience with others. That right there is marketing. What is more, they do the marketing at no cost to the freelancing business. Clients are always willing to share positive experiences with friends and loved ones.
They also share positive experiences online, which gives the freelancer more social footprint.
With improved marketing comes better sales. Freelancers with good sales are more likely to enjoy better profits. Recurrent payments or billing guarantees future payments. Therefore, the freelancers can relax and focus on other aspects of the business. They do not have to worry about invoicing. Compared to the normal billing systems, this one does a better job of boosting sales. With the other systems, freelancers have to rely on the memory of the clients to pay what they owe.
Freelance recurring payment system reminds the clients of their obligations.
Consequently, freelancers do not have to spend more money on phone calls, text messages, emails, and regular mail seeking to remind clients of unpaid invoices. The fact the automated system is not monotonous is an added advantage too. It does all the work while the freelancer receives and enjoys all the benefits. The freelancer does not have to worry about paying an employee who spends countless hours sending invoices. Therefore, look for the best freelance recurring payment system and start using it in your freelance work today to reap the rewards.