Alteration of billing period

You need to have a policy for billing periods. It's a simple fact of life that some billing periods suit people's budgets better than others. Many big companies have a variable billing structure, and it's generally liked by their customers.

In purely business sense, the customers' needs regarding payments have a natural priority. For smaller businesses, however, altering billing periods means altering cash flow. That can be a problem for their budgets. It can even be a problem for finance, when the figures change on a monthly basis.

There needs to be a balance between the needs of the business and the needs of the customers. Not altering the billing period can lose customers who need to pay on a monthly or quarterly timeframe.

There are legal considerations regarding any billing period, which is a term of trade.

You may be bound to an unfavorable cash flow situation by varying periods of billing.

The example below is based on an acceptance of an alteration of billing period upon request.

Note that the terms of the alteration are spelled out for the client. The new billing period is a term of trade, and must be clear.

Example:

Addressee

Your reference
Our reference
Contacts

Dear

Alteration of billing period

I refer to your phone call / letter / email requesting an alteration of billing period from monthly payments to quarterly.

I'm pleased to inform you that this request has been accepted.

Note: The following terms apply to the new billing procedure:

The balance of your account owing for this calendar month will be included in the first quarterly payment bill due in June this year.

Payments for quarterly bills become due on the last day of each quarter.

Payment of accounts is required within 30 days of that date.

Please contact our Accounts section (insert phone number) should you require any further information.

Yours sincerely

Sign
Title
Date

Disclaimer

Please note:

This text is intended for advisory and guideline purposes only.
Any business letter can become a legal document, so check your content properly before issuing.
Any executable or statutorily defined document should be checked for compliance with legal requirements, and you should seek legal advice regarding its contents.