Nothing is more frustrating for a business owner than chasing down members to collect payment. Along with utilizing an automated billing system, there are some ways you can streamline your process to benefit both you and your members. Making sure members understand your billing policies and practices is a necessary step.
Clear Billing Policy
Surprises are great, but surprises on your credit card? Not so much. Creating clear documentation for billing policies will help you avoid a lot of headaches and improve member retention. Be sure to include the following details in your member agreement:
When payment will be processed
As people enroll in memberships, use this time to communicate when the new member will be billed and if their membership will be pro-rated or billed every month on the signup date.
How payments will be processed
Members will also gain from knowing how they will be billed. In your documentation, communicate that your business will process payments through an automatic withdrawal from the member’s preferred financial institution account or credit card. It’s a good idea to verify the member’s billing address as you setup a payment method.
Document what constitutes a late payment and the fee members will accrue if they do not pay within your set constraints. Be sure to also communicate the terms of termination or suspension should the late payments continue.
Membership fee changes
Gym owners have the right to change membership rates but members may not understand how changes to their membership correlate to your payment processing schedule. Include in your documentation member expectations for when new rates will be applied.
One of the most important aspects of your billing policy, the membership cancellation policy, should be communicated as soon a new member signs up. Document the days or months in advance that you need to receive notice from a member if they wish to cancel.
Automated billing is essentially built around a long-term recurring relationship with your members. The more transparent you are with your billing process, the more your members will trust you. Consider adding your billing policies to your website so that members may easily reference them. Many business owners also provide the information in a new-member welcome packet.
Because many people receive a fitness reimbursement, whether at their place of work or through their insurance, it’s a great idea to communicate how members can access receipts and past payments. With a better understanding of your billing system, members can also update billing information on their own.
Benefits of an ACH
While providing an ACH (Automated Clearing House) payment method benefits both you and your gym members, it can be difficult to “sell” ACH to members. Be sure to communicate that using an ACH is convenient and easy to use, protects members from fraud and is better for the environment. Members will be familiar with direct deposit, automatic bill pay, etc., so use these as examples to explain the ease of use with an ACH at your gym. Over time your members will appreciate the convenience, and you will appreciate the speed at which you’re paid.
A lot of billing confusion can come from additional charges. Your class cancellation policy is one item that many members will inquire about, so take the initiative and communicate your policy from the get-go. Document how members can lose class credits or incur no-show charges. It’s also a great idea to document the cost of water, snacks, products, etc. that you provide at your facility. Making these items available on your website also offers some transparency.
Looking for additional information about automated billing? Get your copy of our free Guide to Automated Payment Processing.