How to Get Paid on Time
Part of our series of articles on How To Grow Your Pet Sitting Business:
Some pet sitting companies, and in particular the smaller ones who have not been operating that long, will have, perhaps understandably, no payment policy in place. Some of their clients might be paying in advance, some after service is complete, some weekly and some monthly, some in cash, some by check, some PayPal and some using internet banking.
When asked if they have considered introducing a uniform policy, the typical response is “I like to let my clients choose how to pay”. A great sentiment when you are a small business, but something that will have to change when you try to grow your pet sitting business.
“remembering your various payment agreements becomes pretty difficult and the administration becomes impossible”
When you first start your business it’s pretty easy to remember what you have agreed to with half a dozen clients. However, as soon as you take on more clients when you start to grow your business, then remembering your various payment agreements becomes pretty difficult and the administration becomes impossible. And naturally, mistakes are made.
This particular article is all about the saving time and money on your administration. Pet sitting companies are notoriously difficult to administer and so the key is to keep it uniform and keep it simple.
So many pet sitters quite openly admit that they do not have a life outside work because the pet sitting business has taken over. Even with a midsized pet sitting business, it is still possible to have weekends off and also take a vacation once a year. However, to achieve this you need to have put the right policies and procedures in place, which are then “motorized” by your Pet Sitting Software (Pet Sitter Plus).
“pet sitters quite openly admit that they do not have a life outside work”
So what rules should you think about putting in place when it comes to asking your clients to make payments?
First of all, whatever you do, the key is to make it uniform. Avoid having one rule for one client and another rule for the next. So, create one set of rules for all your clients and stick to them like glue. The rules you decide on are likely to be different depending on the type of services you will be delivering. For example, its commonplace for pet sitting businesses to ask for walking services and pet visits to be paid for at the end of service and for overnight boarding services to be paid in advance, but there are many different variations.
Let’s examine “dog walking” in this article.
Dog Walking Payment Policies
The way in which you ask your clients to pay for dog walking will depend on a few key considerations. Ask yourself the following:
Do I want to ensure ALL my invoices are ALWAYS paid, without fail?
Am I going to allow people to book and cancel services during the month or do I want people to tell me up front what they require and have a fairly fixed cancelation policy?
Will I be asking people to pay me weekly or monthly?
Option 1 – Asking for payment in advance
If you want to entirely eliminate the possibility of one of your clients failing to settle their account, then you need to implement a “payment in advance” policy whereby you take payment before any services are delivered. If this is your policy then you are going to need to gather your customers’ requirements for the coming week or month ahead so that they can be scheduled into the DIARY & SCHEDULING section of Pet Sitter Plus, or on your paper calendar. This is actually not as hard as you might think. It is likely that 60% of your clients will order the same thing week-in week-out, and so all you really need to know is what services your ad-hoc bookers require.
Now that you have all your customer requirements identified, you are ready to invoice your clients. Pet Sitter Plus has a bulk invoicing facility that will email a fully itemized and professional invoice to all of your clients, in a matter of seconds. If you have not yet made the switch to a computer based system then using a manual system for this process could take anything from a few hours to a full day, depending on the amount of invoices you have. Whichever method you use, once the invoices have gone out, provided that you have stopped accepting cash payments in your growing pet sitting business, then it’s simply a case of waiting for the payments to arrive in your bank account or the checks to arrive in the post.
So how do you handle cancelations if a customer has already paid for the month ahead?
Well, this is a troublesome issue with a manual system because you need to devise some way of recording the credit to carry forward to the next week or month and this is where so many mistakes are made. But with Pet Sitter Plus it’s pretty simple. All you need to do is cancel the service in Pet Sitter Plus and the system does the rest. Behind the scenes it will “auto generate” a credit note and this credit then gets carried forward and deducted from next months’ invoice automatically. You are of course able to make a charge for late cancelations if you wish; this is entirely down to your own policy.
“All you need to do is cancel the service in Pet Sitter Plus and the system does the rest.”
Option 2 – Taking Payments at the end of Service
Your other option is to operate a “payment at the end of service” policy. Again you can choose to collect payments weekly or monthly as required. Collecting payments on a monthly basis instead of weekly reduces the number of receipts that you have to process by 75% which has a tremendous benefit in terms of the time spent in administration. While “payment at the end of service” carries an inherent risk that your client may not settle their account, it has the advantage of being easier to administer because there are no credit notes to carry forward into the next month.
So what are the benefits for you?
When you are dealing with a small number of clients your admin problems seem “small”, but soon start to build as your client base increases in your growing pet sitting business. For example, if you were scheduling walking services for up to 90 different customers each month, using the recurring services feature of Pet Sitter Plus, you could schedule around 60% of your monthly walking work in about 5 seconds (which would likely be about $10,000 - $15,000 worth of walking work). The system generates the service order, updates the schedule, calculates staff payments and creates the invoice in one action. It also knows exactly what to charge and gets everything right first time. The random bookings could then get added manually which would take about 20 minutes.
During the month all you have to do is record each additional service request (and cancelation) as they come in and this ensures that your schedule is always up to date, as are the staff schedules which are accessed by staff via their smartphones. Because the schedule is linked to the invoice, this also ensures that invoices are correct too and ready to go at the end of the month. Using the Pet Sitter Plus bulk invoicing feature, you would then send out about 90 in a matter of seconds. Add to that the fact that payments can be taken automatically from credit cards, you have a very efficient system that removes a lot of admin headaches.
Introducing Standard Payment Policies
The real benefit of having a standard payment policy is that you don’t have to manage a mixture of monthly and weekly invoices on your system. You don’t have to be thinking “does this person pay in advance or are they paying at the end of service” and this is really important when you need to schedule in bulk and invoice in bulk. The same goes for any customers that have a discounted price, as this can all be set up in your prices to automatically apply the discount.
“you could save two working days a month in scheduling and invoicing activities alone”
With a standard payment policy, you can schedule work in seconds and invoice in seconds. I would estimate that you could save two working days a month in scheduling and invoicing activities alone and this is precious time you can spend with your family.
Pet Sitter Plus can help you to easily set up your services, and also to apply automatic pricing changes for services, such as discounts and supplements for different times of the day or week, or on public holidays.