6 tips to implement a new invoice and payment process into your child care service

If you’re suffering from slow payments, late payments and non-payments, the chances are your current invoice and payments system isn’t working as well as it could be. If this is the case, it could be time to develop a new structure. Change is always challenging, for everyone involved, so here’s how to implement things smoothly and keep everyone’s good will.


1. Have a clear communication strategy

Everyone involved in the process should be aware of the changes, and how they will be affected. Staff should be given clear indication of their roles and responsibilities. Parents should be notified well in advance that a new payments process is on the way, and once it arrives, it may be helpful to have a month or so transition period.

Have a notice pinned up at your child care service advising of the changes, promote them in your newsletter, and also distribute notices with the current round of invoices.

2. Create supporting documentation

So that everyone is on the same page and 100 per cent clear about changes, make sure you have documentation accessible to everyone. Put it on your website as well, with a notice in your News section of "Changes to Payment Process: [Month, Year]".

What you don’t want is anyone claiming ignorance so it all turns into a mess and feels like a disaster from the get-go. There will be teething problems with any new system. But the more you prepare everyone, the smoother the transition will be.

3. Decide what tools you’ll use

If you started running your business by doing your books in Excel, and sending out invoices manually, you’re probably doing more work than you need.

These days there is easy-to-use, powerful software available for businesses of all sizes. It reduces human error and does most of the heavy lifting for you, such as sending out invoices and payment reminders. The same software can also feed in your bank data and match payments with invoices. Pick the one that’s right for your business, and it will feel like you just hired an accountant-come-PA.

4. Consult staff and core decision makers

It’s important to get buy-in from staff and those that will be using the new system. Ensure that everyone feels involved at each step along the way, and offer whatever training may be required.

It could be worth running a survey to ask parents what payment methods they prefer. Depending where you child care service is based, there may be more parents who prefer to use credit cards, or more that are happy with bank transfers. Ultimately it’s down to you what payment methods you offer, but it may be useful to find out which ones are most popular.

5. Be flexible during transition 

If you change to direct debits, for example, it may take some parents time to set this up with their bank. Allow a grace period before your late payments policy kicks in, if you’re introducing one.  At the same time, make parents aware they were given a waiver so they don’t rest on their laurels next payment cycle.

Encourage on-going feedback

As mentioned, when you start your new system there may be some teething problems. Keep communication open and encourage people to log any issues they have, or suggestions they have to help things run even more smoothly.

For example, if your system involves SMS alerts, some parents may wish to opt out of this. If you’ve switched to email-only invoicing, check that parents are receiving them, and also what email address they would like to use for this. 

Above all, set some KPIs (Key Performance Indicators) so you can assess how your new payments system is going. After three months, how do payment times and rates compare with the old system? Hopefully you’ll be seeing a positive change; if not, you can at least address what’s wrong and evolve your new system accordingly.

For more tips on how to manage your finances, download our free ebook ‘Child care services: Getting smart with fee payments’ by clicking the button below.

Child care services getting smart with fee payments

Topics: Child care centre challenges Child care services challenges Managing finances