MOST OF OUR PARENTS probably uttered words along the lines of, “Make sure you save for a rainy day!” Saving money for “a rainy day” is no different than making sure you have good cash flow. When you have cash on hand, most issues can be solved. As managed service providers, we need cash to pay for everything—payroll, distributors, insurance, software licenses, cost of goods. The list goes on and on.
With cash flow so important to our business, why is it that many of us put up roadblocks when it comes to getting paid? Have you ever said that you don’t want to accept credit cards since you will lose a percentage to bank fees? Do your past due invoices get sent out automatically, or does it require your personal intervention? Do your biggest customers take the longest to pay, using you as their own personal piggy bank? That’s because they understand that cash on hand is important for their continued success.
Don’t beat yourself up. We have all been there. Early on, I refused to take credit cards, not wanting to lose the 3% usage fee. Even worse, my PSA pushed to QuickBooks Online where I then had to send the reminders for any past due invoices myself. You know where that got me? I had about $75,000 sitting on the street waiting to be collected, my past due invoices were always growing, and it was mostly my fault.
An automated payment solution geared for MSPs eventually saved me from myself—and removed obstacles to getting paid.
Features of MSP Billing Solutions
Today there are a wide variety of automated payment systems, including from the major PSA vendors as well as others like ConnectBooster, Chargify, Zoho, and more. Even QuickBooks Online Payments has matured since I first utilized it. Regardless of the solution you choose, make sure you implement one that works for your business and, more importantly, makes paying bills easy for your clients.
Tekie Geek has been using ConnectBooster since 2019. Within the first three months of deploying it, I collected nearly $50,000 in past due invoices.
Solutions like ConnectBooster make it easy for your clients with features such as:
- Billing Portal – All clients are provided with their own billing portal, which makes it extremely simple for them to pay using ACH or a credit card.
- Cash Discounts – When paying with a credit card, the cash/check discount can be removed, allowing for the client to cover all bank costs. Now I don’t lose a single dollar of the sale. This is legal in most states, including New York where Tekie Geek is located, but make sure to check local guidelines.
- Automated Notifications – Clients are emailed invoices as soon as they are loaded into our billing platform and they also receive account summaries along with past due notifications. No one likes to be annoyed over and over again about their past due invoices, but in the end, this certainly does help to get them to pay the bill.