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πŸŽ₯ Our recommended policy and account setup

Use these policy automations to reduce your DSO

Denym avatar
Written by Denym
Updated over 3 weeks ago

In this video, we walk you through our proven Paidnice account setup that has helped businesses reduce overdue invoices by up to 50%.

Core Policy Stack

1. Email Reminder Sequence

Create a comprehensive reminder flow that covers the entire payment lifecycle:

Before Due Date Reminder

  • Timing: 3 days before due date

  • Purpose: Gentle nudge to ensure on-time payment

  • Best Practice: Keep tone friendly and helpful

Due Date Reminder

  • Timing: On the due date

  • Purpose: Final prompt for on-time payment

  • Best Practice: Include payment options and invoice details

After Due Date Reminder

  • Timing: 5 days after due date

  • Purpose: First overdue notice

  • Best Practice: Maintain professional tone while creating urgency

2. SMS Alerts

  • Why SMS?: Highest open rates of any communication channel

  • Timing: 7-10 days after due date

  • Impact: Different medium captures attention when emails are ignored

3. Automatic Monthly Statements

  • Schedule: First or last day of each month

  • Benefit: Regular touchpoint reminds customers of outstanding balances

  • Configuration: Set to "Outstanding items" for comprehensive view

4. Statement Interest Charges

Recommended Setup:

  • Type: Contact-level interest charge

  • Rate: 20% per annum (adjust based on your region/industry)

  • Calculation: Pro-rated daily

How it works:

  • Interest accumulates daily, creating urgency

  • More effective than fixed fees

  • Similar to bank/credit card charges

  • Automatically included in statements

5. Escalation Workflows

  • Trigger: 30 days overdue

  • Action: Internal notification for manual follow-up

  • Options:

    • Assign to specific team members

    • Email external parties (lawyers, collection agencies)

    • Create tasks in your CRM

Pro Configuration Tips

Optimal Timing Settings

  1. Business Hours Only

    • Set action time to 9:00 AM

    • Ensures emails arrive during work hours

    • Higher open and response rates

  2. Weekday Scheduling

    • Enable "Weekdays only" option

    • Prevents weekend sends

    • Professional appearance

Additional Revenue Optimization Policies

Quote Reminders

  • Use Case: Prevent quote expiration

  • Timing: 2-3 days before expiry

  • Benefit: Improved conversion rates

Prompt Payment Discounts

  • Setup: 2-3% discount for payment within 7 days

  • Auto-removal: Discount expires after set period

  • Psychology: Reward early payment vs. penalize late payment

Implementation Workflow

Step 1: Initial Setup

  1. Navigate to your default group

  2. Create all core policies (reminders, SMS, statements, charges)

  3. Set all to "Draft" mode initially

Step 2: Testing Phase

  1. Review actions in the queue

  2. Preview emails and charges

  3. Manually approve initial batches

  4. Monitor customer responses

Step 3: Full Automation

  1. Switch successful policies to "Active" mode

  2. Keep sensitive actions (like interest charges) in "Draft" for review

  3. Monitor dashboard for performance

Managing Your Action Queue

Draft Actions

  • Review and approve pending actions

  • Preview before sending

  • Bulk approve when confident

Scheduled Actions

  • View upcoming automated sends

  • Modify timing if needed

  • Cancel inappropriate actions

Completed Actions

  • Track what's been sent

  • Reverse charges if necessary

  • Review effectiveness

Expected Results

Businesses implementing this recommended setup typically see:

  • 50% reduction in DSO (Days Sales Outstanding)

  • 30% fewer overdue invoices

  • 75% reduction in manual follow-up time

  • Improved customer relationships through consistent communication

Best Practices

  1. Start Conservative: Begin with gentle reminders, add enforcement gradually

  2. Monitor Response: Use dashboard to track effectiveness

  3. Adjust Timing: Optimize based on your customer payment patterns

  4. Stay Consistent: Regular communication trains customer behavior

  5. Document Everything: Use escalation notes for audit trails

Troubleshooting

Low response rates?

  • Check email deliverability in dashboard

  • Verify contact information is current

  • Test different reminder timing

Customer complaints about charges?

  • Consider lower interest rates initially

  • Use "Draft" mode to review before applying

  • Create exceptions using tags for VIP customers

Too many escalations?

  • Extend escalation timeline to 45-60 days

  • Add more reminder touchpoints

  • Review customer credit terms

Need help optimizing your setup? Our support team at [email protected] can review your configuration and suggest improvements based on your industry and customer base.

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