Chasing late payments is one of the least enjoyable parts of running a business. But with the right approach, you can collect what you're owed while maintaining positive client relationships. Here's how to follow up on unpaid invoices professionally and effectively.
Before the Due Date: Set Yourself Up for Success
The best way to handle late payments is to prevent them in the first place:
- Send invoices promptly - The sooner you invoice, the sooner the payment clock starts
- Make payment terms crystal clear - "Net 30" should be prominent on every invoice
- Offer easy payment options - Accept credit cards, bank transfers, and digital payments
- Send a reminder before the due date - A friendly heads-up 3-5 days before can prevent late payments
The Follow-Up Timeline
When an invoice goes unpaid, timing is everything. Here's a proven timeline for following up:
Day of Due Date: Friendly Reminder
Email Template:
"Hi [Name], I hope you're doing well! Just a friendly reminder that invoice #[NUMBER] for $[AMOUNT] is due today. Please let me know if you have any questions or if there's anything you need from me to process the payment. Thanks!"
7 Days Overdue: Direct Follow-Up
Email Template:
"Hi [Name], I wanted to follow up on invoice #[NUMBER] for $[AMOUNT], which was due on [DATE]. I haven't received payment yet and wanted to check if there are any issues I should be aware of. Could you please provide an update on when I can expect payment? Thank you."
14 Days Overdue: Firm but Professional
Email Template:
"Hi [Name], This is a follow-up regarding invoice #[NUMBER] for $[AMOUNT], which is now 14 days past due. I understand things can get busy, but I do need to receive payment to continue our work together. Please process this payment within the next 7 days or contact me to discuss an alternative arrangement. Thank you for your attention to this matter."
30 Days Overdue: Final Notice
Email Template:
"Hi [Name], Invoice #[NUMBER] for $[AMOUNT] is now 30 days overdue. This is a final notice before I need to consider other options for collecting this debt. Please remit payment immediately or contact me within 48 hours to discuss. If I don't hear from you, I'll need to [pause future work/engage a collection agency/take other action]."
Communication Best Practices
Do:
- Stay professional - Never let frustration show in your communications
- Be specific - Always reference the invoice number, amount, and due date
- Give them an out - Ask if there's an issue you can help resolve
- Document everything - Keep records of all communications
- Pick up the phone - Sometimes a call is more effective than email
Don't:
- Be aggressive - Threatening language damages relationships and rarely works
- Assume the worst - Many late payments are due to oversight, not bad intent
- Wait too long - The longer you wait, the harder it is to collect
- Take it personally - This is business, not personal
When to Consider Late Fees
Late fees can encourage timely payment, but they need to be handled properly:
- Include them in your contract - Late fees should be agreed upon before work begins
- State them on every invoice - "A 1.5% monthly late fee applies to overdue balances"
- Be consistent - Apply late fees equally to all clients
- Consider waiving for first offenses - Build goodwill with good clients
When to Escalate
If standard follow-ups aren't working, you may need to escalate:
- Phone call to accounts payable - Sometimes emails get lost; a direct call to the right person can resolve things
- Formal demand letter - A more official letter stating consequences of non-payment
- Collection agency - They typically take 25-50% but can be effective for large amounts
- Small claims court - For smaller amounts, this can be a cost-effective option
- Legal action - For larger amounts, consult with an attorney
Preventing Future Issues
Learn from late-paying clients:
- Require deposits for new clients (50% upfront is common)
- Use shorter payment terms (Net 15 instead of Net 30)
- Consider requiring payment before delivery for problem clients
- Check references before taking on large projects
The Bottom Line
Following up on unpaid invoices doesn't have to damage relationships. With professional, timely communication and clear expectations, you can collect what you're owed while maintaining your reputation. The key is to act promptly, stay professional, and document everything.
Using invoicing software like InvoiceBloom helps you track payment status, send automatic reminders, and know exactly which invoices need attention - so you never lose track of money owed to you.