When everything goes according to plan in the construction industry, your submitted invoices will be paid promptly so you can keep working or move on to the next project. It’s rarely this simple, but what you may not realize is that your inability to manage invoices could be the root of the problem. When it comes to invoice management, contractors make many mistakes. In this article, a Memphis contractor lawyer will discuss five tips for avoiding these mistakes with your invoices.
1. Be Aware of the Terms and Conditions
Always read your contracts all the way through. And when you’re done, consult a Memphis contractor lawyer to review the contract again. It’s impossible to overstate how important it is to be fully aware of the terms and conditions of every contract you sign. Contracts contain information pertaining to which forms of payment are acceptable, payment deadlines, and more. Without this information, how can you possibly manage your invoices?
2. Pay Attention to Client Billing Processes
Subcontractors often find themselves fumbling with invoices when taking on work for new general contractors that have different payment processes. Contractors must take the time to memorize the billing process and schedule for each individual client. Depending on the details of the contract, certain clauses could positively or negatively affect your cash flow. However, there are some programs designed to ease this disconnect, like Textura, a payment processor that helps streamline construction-related invoicing.
3. Avoid Submitting Late Invoices
When you submit invoices late, they’re less likely to be satisfied. Sometimes, this isn’t due to a lack of attention, but a lack of administrative support. While “pay when paid” clauses can help extend invoice deadlines, it’s an imperfect and divisive system that can create tension between contractors and subcontractors. Cash-poor subcontractors can also be a burden to your project, so it’s usually a good idea to submit your invoices on time so that everyone can get paid in a timely manner.
Don’t let payment disputes bog down the success of your business. Submit invoices on time and for the correct amount to ensure that everyone involved in your project has the monetary fuel to keep things rolling along on schedule. If you’re currently embroiled in a payment dispute, consult the Memphis contractor lawyers at Cotney Construction Law.
Disclaimer: The information contained in this article is for general educational information only. This information does not constitute legal advice, is not intended to constitute legal advice, nor should it be relied upon as legal advice for your specific factual pattern or situation.