Discussion on:

Collect on unpaid invoices and keep the client

If you are doing work for a client, and that client hasn't paid (or made arrangements to pay) for prior work, you really need to stop doing work for them.

While it's true that they MAY recover financially and pay for all past, present and even future work - you can't count on that to happen. If they REALLY need your services, they'll arrange payment. If not, it's best to part ways and chalk it up to experience - better than paying a lawyer to offend a potential future source of income.

I remember one time when 30 day net turned into 120 day net and would have gone to 180 day had i not made a return trip to the site with my screwdriver in a side holster. When i was asked what i was going to do I told them that since i had not beenpaid I would repo the hard drives since my work was on them.

had the check in five minutes.
Ps the client still calls but i will not do any more work for even if i'm starving

Some "clients" aren't worth having. Just like the credit card Co's I have to mark up my services to cover the bad cases. The fewer I carry the lower my (and the "good clients")costs.
I'll always discounted services to long time clients who pay thier bills... even if they pay late so long as they pay.
On the other side, I can be spectacularly unavailable or very expensive w/ unreasonable terms for the ones I don't care to do biz w/

When I first started out, I used to think I was being nice by allowing clients to slip a bit. I thought by being nice I was building a stronger client relationship. I always got paid, but eventually I figured out that having a solid A/P policy andsticking to it shows professionalism and that I take my business seriously.

I'm not rude about it, but I enforce my 30 day net unless other arrangements are made (some co's and gov't take longer to pay, some co's take longer on the first check,but pay regularly after that) and in 20 years of consulting, I've only had to go to collections twice. Both times I ended up getting my money before courts were involved.

In 22 years of consulting, and having large collection agencies as one of my vertical markets I have found "nice" clients are oftem the one's that stiff you. Beware the client that was very unsatisfied with previous jobs, but has a very upbeat attitude with you. It's not human nature. If you can get a D&B when you start, and set terms accordingly. If you get a BS reason for non-payment, terminate the contract and move on to clients that keep their end of the bargain.

RTD

Hi, I am a new business, I just completed a round of focus groups (for a new tech product) and despite the contract, the client has completlely failed to pay and has taken the work I did for him (mainly the focus groups and reports) and stated that he has no intention of paying,instead, after work was done notifying me in email that he ran out of funds and wants to sever the relationship. I am out 15k and I have no clue how to go about collecting. Does anyone have advice for me? It's very dissapointing.

Payments for these types of projects are done in thirds. The final results are not given until the final payment is in hand. I use a collection agency. Contact me if you need help.

how much does it cost to use a third party; collection agency

Clients have their own problems and hidden agendas and, like the rest of us, would like some things to go away so that they can concentrate on others which are worrying them. I have had excellent clients who were shamefaced and embarrassed when I arrived personally at their offices and requested my overdue payment - and hastened to make out a cheque there and then; but they would let it slide for months if I didn't prod them. Turns out there was an impending takeover, and they were preoccupiedwith getting the accounts to look as good as possible! I was always paid eventually.

Per CA guidelines, contractor can only collect a maximum or $1,000.00 or 10% of the total cost whichever is lower. Can you explain to me how can I justify asking for 50% down for contract 1,000.00 and up

Thank you.

Bernadette