Accounts Receivable Process: Set the Billing Routine

Stop Chasing Invoices, Start With a Fixed Billing Day

Pick a day of the month and make it billing day. The 1st works well. On that day, every active client gets an invoice, no exceptions, no "I'll get to it Thursday." Say you run 30 clients. Your office manager knows the 1st is billing day, the invoices go out in a batch, and the rest of the month is support, not invoicing.

This is a routine, not a preference. Clients learn when to expect the invoice, and you learn when to expect payment. A fixed day turns billing from an event you dread into a task you schedule.

Get Contract Terms That Hold Up

Your contract needs three things: Net 30 terms, meaning payment is due 30 days after the invoice date; a late fee clause, or at least the explicit right to suspend service; and a suspension clause that lets you cut off service at Net 60, meaning 60 days past the invoice date.

Check that existing contracts grant the right to suspend service before relying on that remedy. If they do not, have the terms reviewed and agreed before changing how you enforce payment. Include the reviewed clause in new agreements.

Have a lawyer review the suspension clause before you rely on it. One MSP that adopted this exact set of Net 30 terms, reminders at Net 45, suspension at Net 60, and collections after 90 days reported that the collections agency collected on every issue, but that's a single report; results with collections agencies vary.

Set the Chase Sequence: Remind, Suspend, Collect

The sequence is fixed, and it's the same for every client. Mark the calendar the day each invoice goes out, and work from there:

1. At Net 30, the due date: send the first reminder. A short, polite email: "Your invoice #1234 was due today. Please remit payment."
2. At Net 45, 45 − 30 = 15 days after the due date: send a second reminder, firmer. "This invoice is 15 days overdue. Payment is due now."
3. At Net 60: suspend service. Send a notice first, then cut off access. No warning beyond the notice, and no negotiation unless you decided in advance to grant a grace period.
4. At Net 90: send the account to collections.

The sequence is the point: it removes the guesswork.

Who Owns the Chase?

The office manager owns the routine, with the owner backing them up. That means the office manager sets recurring calendar tasks on billing day (the 1st), then at 30, 45, 60, and 90 days after each invoice date. Each task has a template attached: the first reminder, the second reminder, the suspension notice.

The owner's job is to be the backup and the enforcer. When the office manager sends the suspension notice, the owner knows it's coming and supports it. When a client calls to argue, the owner doesn't cave.

But here's the failure mode: the routine dies if nobody covers the billing day when the office manager is unavailable. If they're out sick on the 1st, someone else runs it. That means the templates and the client list live somewhere accessible, and a second person knows the routine. If you don't plan for that, you're back to chasing invoices ad hoc.

When the Routine Breaks: Cutoff and Collections Done Right

At Net 60, you suspend. At Net 90, you send to collections. Before you suspend, decide what stays running, such as backups, and put that in the contract. Then do it without apology. You are not being unreasonable; you are enforcing the terms the client signed.

One operator described a client who had squeezed the price, then dragged out payment and demanded free support until the bill came due. Continuing service without payment adds to the unpaid work.

Two refinements, both within your control. First, for long-standing reliable clients, you can allow a grace period beyond Net 60. That's a judgment call, and it only works if you make it deliberately, not because you forgot the date. Second, for new clients, enforce the terms strictly from day one. They set the pattern for the relationship.

And if the client disputes the invoice at Net 45, the timeline stalls until the dispute is resolved. That's fine. What's not fine is letting a dispute become a reason to never send the second reminder.

Your Monday Morning First Step

Three things, before noon:

1. Pick your fixed billing day. If you don't have one, make it the 1st of next month.
2. List your top five overdue accounts. For each, note where they are in the chase sequence: Net 30, Net 45, Net 60, Net 90.
3. Set the calendar reminders for the next step on each account. If one is at Net 30 today, schedule the reminder email for today. If one is at Net 60, schedule the suspension notice for tomorrow morning.

That's it. The routine doesn't start with a grand overhaul. It starts with a fixed day, a list of five accounts, and a calendar. Do that on Monday, and the chase stops being a scramble.