If you work in construction accounts receivable, it can be stressful if you don't approach it the right way. While it's easy enough to give out credit to anyone who asks for it, it can quickly become hard to collect those payments. However, there are certain behaviors you can avoid that will help you lower your risk of stress and nonpaying accounts.

When you go under contract with a client on credit, you're showing that you have a lot of trust in that client to pay you as they say they will. However, not all customers should be given this same level of trust because many will abuse it. It's important to only give out construction loans to customers who have the credit history to prove they'll hold up their end of the agreement.
The best way to make sure you're doing this is to ensure every customer fills out a credit application before you give them a loan for your company's services. This will help you see how their credit payment history looks before you decide if they're worth the risk.

We've all had moments where we've forgotten to pay a bill and ended up having to pay it late. While these mistakes happen, you must be strict about your late payment policy to ensure customers don't make a habit of sending you their payments late. This means being diligent about charging any late payment fees that you have set in place in the contract.
However, it also means going the extra step and sending out a notice of intent to lien if you have a customer who has fallen behind on their payments. If they still aren't paying, be sure to follow up on the notice and file a lien if necessary. When you make sure to follow the correct process when it comes to late payments, it helps in many ways. For one, you will be more likely to get the payment you're owed if you're diligent about following up. Also, your customers will be more likely to take your credit terms seriously if you're always following through on what you say.

If you wait until an invoice payment is a past due, you're affecting the company's bottom line and approaching your position reactively. Instead, you should be contacting your customers regularly about their payments to ensure they pay them on time. A great way to be proactive in this regard is to contact customers a few days before their invoice is due so you can remind them about it. Sometimes a reminder is all a customer needs to avoid a late payment.
To have a proactive approach to your communications, you need to make sure your tracking process and data are always up to date. Take time to set reminders for yourself as needed to ensure you're reaching out to your customers promptly.

Construction accounts receivable is a crucial position in any construction company. Handling invoices correctly is vital to ensuring the company's funds are collected correctly and promptly. Nationwide Notice, Inc. offers digital tools to help you keep up with your company's invoices so you can be proactive instead of reactive.
Contact Nationwide Notice, Inc. for assistance with securing payments, as we are a full and self-service notice and lien company. We can help you streamline processes like filing a lien. Utilize the expert team of dedicated lien experts at Nationwide Notice, Inc. to guide you through the entire lien process. Learn more about the services we provide here or check out this page to see what makes us different.