6 Must-Have Features for Construction Payments
Construction billing is anything but simple for most companies. Complex projects, from flooring to roofing and everything in between, require multiple moving parts and lengthy invoicing details. Without a comprehensive and effective billing system, it’s too easy to hemorrhage money. In fact, 82% of businesses cite poor cash flow management as a reason for failure.
And healthy cash flow begins in accounts receivable (AR). A sound payment collection process is the cornerstone for a thriving construction company. Not only can an efficient and automated AR system ensure you get paid faster, but it also gives you the funds to maintain good relationships with suppliers and contractors, as well as funnel revenue into growth opportunities.
This is where finding the right technology stack comes in. This step is critical for construction companies, which requires a nuanced and customized approach to billing. While there are some green flags all industries should look for in a payment solution, such as PCI Compliance and timesheets, there are essential features specific to construction-billing.
To make your search criteria simple, we’ve curated a list of the top six must-have features for construction payments:
- Granular Customization
Construction is one of the most nuanced industries when it comes to billing. Project specifications are extremely detailed, and one minor error or complication can lengthen payment time.
The best construction payment platforms offer high-degrees of customization. A tailor-made process that makes sense for your company and your customers reduces the likelihood of error, simplifies project coding, and enables you to get paid faster.
Customization can include project-specific fields for billing, accepted payment methods, alternative payment options such as loyalty programs, and similar settings. And with the right platform, these tailor-made processes are scalable.
- Click-To-Pay
Click-to-pay functionality has already transformed payment transactions. A recent study from Mastercard found that the checkout conversion rate for click-to-pay transactions was a whopping 96% and the average checkout time was only 1.17 minutes.
But what is “click-to-pay”? Rather than wasting time and resources on paper invoicing, click-to-pay enables you to send an invoice via email or SMS. And your customer only has to click “pay” to get started. The best payment solutions will enable you to securely save a customer’s payment data—so it really becomes a one-click transaction.
It’s clear that this capability is an effortless way to accelerate payment time while improving the payment experience for your customers.
- Recurring Billing
There are multiple ways to bill your construction projects—but none are quite as effective for both a construction company and their client as recurring or progress billing. Many construction projects take weeks or months to complete. Clients may be unwilling to pay for such projects all at once. A recurring billing cycle allows you to automate the billing process over time, making it easy to build a consistent invoicing process and build trust with these larger-project clients.
But recurring billing can streamline smaller projects, too. This method can be an alternative payment strategy for clients with smaller budgets who may need space out payments. Conversely, you can use recurring billing features to better collect retainer-based services, such as contracts for regular maintenance or repairs.
- Invoice Alerts
What if a customer doesn’t pay immediately? The right accounts receivable (AR) software will make it simple to send alerts, whether that’s a reminder for an upcoming payment deadline or for delinquent payments.
This seems like a simple feature, but it’s often outsourced to collection agencies or email software. Having invoice payment reminders and alerts built into your payment solution will save time and streamline the process.
- Detailed Reporting
It’s impossible to improve what you don’t track, which is why an automated reporting dashboard can make it easier than ever to spot bottlenecks and opportunities for revenue growth. The best construction AR software will provide you with enhanced reporting tools.
In particular, a robust reporting feature tracks authorizations, transaction history, transaction summaries, day-sales-outstanding (DSO), and late payments. Every report should be automatically generated and accessible online.
Fast and accessible reporting will make it easier than ever to make critical business decisions, from determining which suppliers to stick with to how to optimize your cash flow.
- Integrations
You will most likely be using your AR software in conjunction with your ERP or other accounting solution. That’s why one of the most key factors to a successful adoption of a new AR tool is seamless integrations. Your AR tool should be able to plug-in and sync data from your other construction project software, whether that’s Sage, NetSuite, or another accounting tool.
Take Your Construction Billing to the Next Level
From customizing your invoices and AR process to implementing consistent recurring billing, invoice alerts, and click-to-pay links, there are several ways to maximize your revenue without adding more work for your billing team. These six features offer the fastest route to improving your AR process and creating a healthy construction company cash flow. The only question left is which payment platform can you trust?
As an award-winning API, Fortis offers these features and more. With an incredibly versatile AR system, industries from construction to manufacturing and hospitality can streamline their revenue, get paid faster, and improve reporting.
Book a call with one of our guides today to learn more.