Increase Cash Flow: Get Paid Fast!

August 3, 2022
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For service-based businesses, cash flow issues are directly correlated with slow or late invoice payments by clients. 

And for B2B services, like agencies and consultants, it’s often worse. Businesses invoicing other businesses causes a collision between (your) accounts receivable (A/R) and the client’s accounts payable (A/P). 

If you’re not intentional in how you’re invoicing and following up with clients, it’s likely you’ll run into cash flow issues. 

So, how do you get paid fast, while staying on top of your A/R process? Let’s get into it.

Perform Service(s), Send Invoice, Get Paid…Right?

When you were a sole proprietor, you likely had very little overhead. Collecting invoices wasn’t do or die, most of the time. You didn’t mind waiting an extra month to get paid because you didn’t have many expenses.

But once you hit the 7-figure range, timely payments become hugely important and too many sluggish payments can put your business in a bind.

A bind meaning:

  • Payroll crunches
  • Inability to reinvest cash into the business
  • Valuable time chasing payment 

If you don’t put in the work to develop payment systems as you grow—Before you know it, you’re spending HOURS chasing down payments from customers and you’re constantly stressed about the amount of cash in your bank account.

The problem? 

The fundamental issue here is that you are paying your employees BEFORE you are being paid by your customers. Doing so creates never-ending cash flow issues and STUNTS GROWTH because you have little cash to invest back into the business. 

The Quick “Secret” to Fixing the Problem

  1. Get paid by your customers before you pay your employees. 
  2. Be in control of pulling the money from your clients’ bank accounts (or charging their credit card) rather than them pushing the payment to you. 

Let’s break it down by worst, bad, better and the best way to get paid. 

  • WORST: You get paid after performing the service. The client controls the payment. There is no electronic payment option, bank info, or even your address on the invoice. The client sends a check whenever they get around to it or figure out where to send it. 
  • BAD: You get paid after performing the service, but you at least include an electronic payment option on the invoice so the client can easily pay right when they receive it. But again, you’re still waiting on them to trigger the payment and their email inbox is pretty full 
  • BETTER: You require payment upfront before starting any work (yes!). The client signs the engagement letter but then lags for 2 weeks before paying the retainer (damn!). Your team can’t get started until you receive payment and now you are two weeks behind schedule 
  • BEST: You require the client to sign an ACH or credit card authorization upon signing your engagement letter. YOU initiate the payment as soon as they sign and your team is ready to hit the ground running. You never have to hassle the client for payment for any current or future services.

NOTE on hourly fee revenue models: If you charge hourly and don’t want to deal with retainers (the accounting can be burdensome) you can do weekly billing and then auto-charge the amount due. The key is you pull the money and/or charge the credit card each week.

Have questions about automatically collecting client payments? Reach out to the experts at Momentum

Apps for the Quickest Cash Flow Solution 

There are a number of solutions for setting up a system where you pull payments from clients, rather than asking them to push those funds to you. 

Here is a list of our top choices (in no particular order).


Ignition is a proposal and billing tool for growing professional service firms. Customers can pay by Credit, Debit card, or ACH. It integrates with Xero and QBO


  • $65 -$325 per month for the software 
  • ACH – 1% up to $4
  • Credit Card – 2.5% + .30

Good for: Businesses with recurring revenue that are onboarding clients quickly and want to streamline their sales and billing process. 

Intuit QuickBooks Online

Quickbooks has its own ACH and credit card option built into the product. 


  • ACH Fees- 1% with a max of $10 
  • Credit Card – 2.9% + 25 cents

Good for: A service business that is already using Quickbooks Online. 


Xero seamlessly integrates with a handful of different payment processors. 

Xero’s ACH payment processor is GoCardless


  • GoCardless fees are very low at 1% + $2.50, max of $2.50 per transaction. Additional fee of 0.3% applies to transactions above $1,000. 
  • For credit card options, there is a handful that can be integrated including PayPal and Stripe, among others. CC fees are typically around 2.9-3%.

Good for: A service business that is already using Xero. is known as software to pay bills, but it actually has a receivables feature. You can have customers pay one-off invoices electronically or set them up for recurring payments. The cons: It is a bit clunky and doesn’t have the best integration w/ Xero and QBO.


  • $39 per month for the software. Free ACH payments 

Good for: Someone just starting out and looking for a very low cost, fairly simple option with few bells and whistles. Good for recurring ACH payments 


Freshbooks has been in the invoicing game since 2003 and more recently they’ve been focused on building out a full accounting suite 


  • $4.50 -$15.00 per month + Credit Card fees
  • Choose Freshbooks’ built-in CC processor, Stripe, or PayPal. Again, CC processors are typically around 2.9%. 

Good for: Freelancers and solopreneurs 

Honorable mention

Routable and Veem are decent AR automation options and integrate with Xero and QBO, however, they do not handle recurring payments. 

A quick note on ACH versus credit payments

First, ACH is always less expensive. If you are selling high-volume, low-cost services, credit cards are great. However, if you are selling high-dollar, low-volume services, ACH is the better option. 

A Client Won’t Use a Payment Processor…Now What?

It’s exciting to work with big names like Google, Nike, Apple, or any client you’d consider a “whale.” 

Getting that logo under a “clients we work with” section on your website is great social proof. 

What’s not as exciting? When you learn that these massive clients have 60, 90 or even 120 day payment terms. Yikes! 

So, that “Nike-level” client may pay 6+ figures a year, but you’ll potentially have to pay your employees 8x (payroll periods) before getting that giant check in the mail. And the payroll could be hundreds of thousands of dollars, too. 

While getting payment in advance is the best solution for most clients, the reality is that these big players have the power. And if you don’t want to play by their rules, they will find a vendor who does. 

In Moments of Opportunity, You Adapt (Here’s How)

Here are some strategies to mitigate the cash flow crunch when working with large companies with aggressive payment terms.

1. Make sure you have access to additional capital

A number of potential solutions exist here, from a line of credit or any other outside funding source. (Be sure to factor in interest and fees into your margins when quoting your lagging payers. See the next point.)

The key here is ensuring your funding source is ready to roll before you need it. If you sign a whale, they may pay late but often want results quickly. The last thing you need is to find adequate financing terms while trying to hire and deliver for your dream client. 

2. Aim for higher margins 

If your typical profit margin is 60%, aim for 70, 80 or 90% margins for services to the whale. 

Working with big brands, higher fees are often expected (i.e. a multi-billion dollar company doesn’t want a $5k or even $50k website). 

Plus, doing quality work with larger companies often begets more work for big business. 

It’s a good idea to build up your cash reserves, find more favorable financing terms, and account for the interest you may have to pay on borrowed money via charging the big names more.

3. Maintain a short-term and long-term cash forecast 

Make sure you’re planning for these big projects, in terms of cash. 

While there are various levels of forecast complexity, at the very least make sure you’re able to cover payroll and operating expenses until you receive payment from your customers…on paper 

A forecast is typically maintained by a CFO or Controller and this person can be in-house or outsourced depending on the size of your company. 

4. Negotiate pre-payment terms during the sales process

Prepayment is not an all-or-nothing game. Ask for all or some of the payment up front. If you’re not willing to ask for everything, make it a reasonable dollar amount or percentage of the total estimated invoice.

5. Negotiate “You get paid when I get paid” terms with your subcontractors 

Remember the early days of your business? The ones we referenced earlier on in this article, when you didn’t have too much overhead and didn’t mind those net 30+ payments?

If you’re working with subcontractors, they’re likely closer to that period of their business. A couple of things to remember when giving subjective payment terms to those you’re paying:

  • They get to work with the whale, too.
  • Consider passing through some of those extra margins to subcontractors willing to wait (aka pay subs working on these projects more).
  • Pay as soon as you get the check, to build the relationship with these freelancers/contractors (after all, happy whales often bring more whales and you’ll need all the help you can get)

The Power of Partnering with a Qualified Accountant

Setting up automatic payments. Developing an accounts receivable system. Managing potentially tight payroll. Finding good sources of financing. Developing forecasts to ensure you don’t go under from a massive success (big client). 

The right accounting partner handles all of these.

Ready to get paid fast while setting solid foundations for your business? Get in touch with us to see how we can help you gain your Momentum.

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