Early-payment-discounts work well for us, UNLESS there are outstanding arrears on the customer account. If that’s the case, the “Balance Due if paid by xx/xx/xxxx” line does NOT show the amount that actually needs to be paid in order to get the discount.
We do advise customers that any arrears must also be cleared in order to receive the early-payment-discount and we do send them a customer-statement as well.
However when there are arrears, it’s fairly common for customers to misconstrue and over-pay (as per the statement, which doesn’t show the discount) or under-pay (as per the invoice, which doesn’t show the arrears).
The “Balance Due if paid by xx/xx/xxxx” line seems to be a ‘customer advisory’ only, and doesn’t seem to otherwise have any effect on the customer account. Previous over-payments are included in the “Balance Due if paid by xx/xx/xxxx” figure but previous under-payments are not.
Can I please request that consideration be given to allowing a change in this behaviour, as per the below image.
That is because early payment discounts are on an invoice-by-invoice basis. And there are good reasons for that. Suppose, for example, you have a good, long-time customer who pays early as normal practice. But their last payment cheque was delayed in the mail and has not yet been entered. Would you deny them the early payment discount on their next invoice? Contractually, they have satisfied the terms of the most recent sales invoice and are entitled to the discount.
If your discounts are dependent on behavior unrelated to the specific invoice, such as requiring the customer’s full account to be paid off, you should not use the early payment discount feature. You should, instead, include the possibility of discounts in the terms of a sales invoice. Disclose that in a custom field, such as Notes or Early Payment Discounts. Include the discounted amount in the custom field content. If the necessary conditions are satisfied, enter a credit note to adjust the customer’s balance.
You must create a credit note for the early payment discount process regardless. The difference in the two situation is that:
Manager’s built-in capability is limited to consideration of the sales invoice involved. This is advantageous (or even essential) when customers buy frequently and invoicing/receiving cycles overlap.
The manual approach allows consideration of other factors, such as unrelated payment history, past purchasing volumes, advertising promotions, or phases of the moon.
Manager’s built-in capability is limited to consideration of the sales invoice involved.
But by default, a payment is allocated to any pre-existing arrears first, unless you take the extra manual step of allocating it to that particular invoice.
The way that automated early-payment-discounts currently operate suits us fine and our policy minimises cases of ongoing customer-arrears.
All I am looking for is a way to reduce customer confusion by showing them on the invoice the ‘bottom line’ they need to pay in order for them to get their discount.
Is there an inbuilt variable that could be used to expose the ‘arrears’ amount with a custom theme?
True, but if you plan to use the built-in early payment discount feature, you should definitely post the receipt to the specific sales invoice. Otherwise, it could end up being post anywhere, and you have lost control of the process.
No. This is because Manager carries the full amount of the receivable until an early receipt is actually recorded. That is necessary because the program cannot predict whether the customer will pay early. If you carried the early payoff amount, your books would not balance.
