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Customers who don't pay on time have always been the bane of small business owners' existence. But in the past couple of years, the late-payer problem has grown into a lifethreatening condition for some small business owners. 

I have one self-employed friend who's just getting to the point of suing one business that has owed her $16,000 for months...a tough call since legal fees could quickly add up to more than that sum.
If you're having trouble getting your invoices paid on time, here are seven tips for getting late payers' checks in the door:

1. Track payments carefully. Know when payments are due so you can attack the overdue-bill problem immediately.

2. Try a friendly call or email. Before going ballistic, try a quick, friendly reach out along the lines of "Hi, I was just taking a look at my accounts receivable and noticed your payment due yesterday hasn't arrived. Can you let me know when I should expect the payment? If you need another copy of the bill, just let me know." This will get many off the dime -- sometimes the bill really has been lost in the shuffle.

3. Choose the right person to follow up. If you have trouble with confrontation, consider whether an employee or even a relative might be put to work making late-bill calls. Someone who can be firm but polite is best.

4. Offer a repayment plan. If the customer is having trouble coming up with the full amount they owe, offer to give them more time without penalty if they send half right now. This preserves the relationship while also getting some cash in the door right away.

5. Rebill and add a late charge. If the customer isn't responsive, when the bill hits 30 days overdue, send another bill with a late charge of between 1 percent and 3 percent. I've personally had clients pay up immediately once they realized their bill was going to get bigger each month they delayed payment.

6. Take preventive steps. If your business has a lot of late payers, reconsider your credit-approval process. Research customers' credit history more thoroughly before granting credit -- run a thorough credit report and check Dun & Bradstreet if they're a big company, or your secretary of state's office for tax liens on smaller companies. Consider extending less credit or asking for a 50 percent up-front payment. 

7. Consider guaranteed-payment methods. With troublesome contractors, consider working through an intermediary agency or online platform such as Elance, where money is placed in an escrow account at the beginning of the job. Instant-payment methods such as PayPal can also end the problem.

Have you had problems with late payers? Leave us a comment and let us know how you handle it.