Client delaying process

[Jay]

Originally Posted by KarenC

Jay - re progressive invoices ...

On all my invoices I have terms Prepaid or 7 days maximum.
Then I send reminder statements each week till payment is made by fax not email. Sometimes the accounts department just doesn't see the invoice and the weekly reminder actually works.
I send it politely with a box in the middle saying 'Reminder - please make payment now. Thank you.'
Usually only one reminder works; rarely it goes to 2 or 3. But I remember to be consistent and make it weekly.

Hi Karen

Thanks again for your feedback, I like your ideas and I am now in the middle of reworking my existing invoice structure and template.

Just a quick question - considering you have prepaid terms, do you send an invoice the moment the estimate has been signed off and received then?

kind regards
Jay

[KarenC]

Message for Jay ... you sent me a private message but when I tried to reply the error came up that you don't receive private messages on the forum. It would be a good idea to allow short private messages for quick reply. I'll try to contact you on Sat. Cheers, Karen C.

[WildAboutHarry]

Jay, this can be a tricky one.

I work on a monthly invoicing cycle, as that's what both my clients and my competitors do.

If I was quoting on a job to a specific brief my quote would include the total, but would allow for monthly payments of the work done to date. It would also include X number of hours for amendments/edits etc at no charge and note that changes to the brief would require changes to the quote. Above that, the quote would say that I charge $X per hour for amendments/edits that go beyond the allowed amount. I then keep in touch with the client as I go about where we are up to, let them know that an invoice for part of the project is coming etc, and to let them know if the project was looking like overrunning the original budget.

I notice that some people who have replied want payment upfront - I have to disagree with the "never" work without payment upfront (I have never worked WITH payment upfront!), as it really depends on your clients are and their policies as to whether or not this is workable. My clients are all large corporates and generally the rule - outside of the control of the person signing the invoice for payment - is that they will not pay the final $ on a job until the work is complete.

I guess it all depends on the nature of your relationship too. All of my clients are long term, monthly billing - the newest is just under two years old, and I have a few more than five years old (I have been in business 7 years, and still have my foundation clients). I'm in it for the long term relationships, and am prepared to give-a-little for cashflow knowing that I'm preserving a long term relationship.

As far as your immediate problem goes - it is time to invoice your client. Call them first, and say that as the project is dragging on unexpectedly, you plan to invoice for the work you have done to date.

But the lesson for the future is to look at your terms on your future quotes and in any contracts you have with clients. When I started my business I invested the $ in getting legal advice to get good contracts and terms in place, knowing that my clients will not live or die on whether they pay me on time (they are huge companies, mine is just me!) but that I would. I strongly recommend this as it can save you a lot of pain and cashflow problems!

WildAboutHarry

[Jay]

Originally Posted by KarenC

Message for Jay ... you sent me a private message but when I tried to reply the error came up that you don't receive private messages on the forum. It would be a good idea to allow short private messages for quick reply. I'll try to contact you on Sat. Cheers, Karen C.

Hi Karen

I am rectifying that problem now, thanks for letting me know.

Jay

[Jay]

Originally Posted by WildAboutHarry

Jay, this can be a tricky one.

I work on a monthly invoicing cycle, as that's what both my clients and my competitors do.

If I was quoting on a job to a specific brief my quote would include the total, but would allow for monthly payments of the work done to date. It would also include X number of hours for amendments/edits etc at no charge and note that changes to the brief would require changes to the quote. Above that, the quote would say that I charge $X per hour for amendments/edits that go beyond the allowed amount. I then keep in touch with the client as I go about where we are up to, let them know that an invoice for part of the project is coming etc, and to let them know if the project was looking like overrunning the original budget.

I notice that some people who have replied want payment upfront - I have to disagree with the "never" work without payment upfront (I have never worked WITH payment upfront!), as it really depends on your clients are and their policies as to whether or not this is workable. My clients are all large corporates and generally the rule - outside of the control of the person signing the invoice for payment - is that they will not pay the final $ on a job until the work is complete.

I guess it all depends on the nature of your relationship too. All of my clients are long term, monthly billing - the newest is just under two years old, and I have a few more than five years old (I have been in business 7 years, and still have my foundation clients). I'm in it for the long term relationships, and am prepared to give-a-little for cashflow knowing that I'm preserving a long term relationship.

As far as your immediate problem goes - it is time to invoice your client. Call them first, and say that as the project is dragging on unexpectedly, you plan to invoice for the work you have done to date.

But the lesson for the future is to look at your terms on your future quotes and in any contracts you have with clients. When I started my business I invested the $ in getting legal advice to get good contracts and terms in place, knowing that my clients will not live or die on whether they pay me on time (they are huge companies, mine is just me!) but that I would. I strongly recommend this as it can save you a lot of pain and cashflow problems!

WildAboutHarry

Hi Harry

Thanks for all of the ideas you have suggested above. I have contacted the client and invoiced accordingly based on all the feedback received, including yours! I am also currently reviewing my invoice template and making the required changes to avoid a potential repeat of this problem in the future!

thanks again
Jay

[Tristan Boyd]

Originally Posted by Jay

Just a quick question - considering you have prepaid terms, do you send an invoice the moment the estimate has been signed off and received then?

We put out payment terms on the last page of our estimate, (50% deposit and 50% on completion), and the estimate includes the total figure, and the 50% figure that they need to pay to start the job. (inc. GST to avoid the 10% of clients who forget to pay GST)

As soon as the estimate is accepted we fire off the 50% deposit invoice, but in most cases we receive payment as confirmation, so the invoice is more of a receipt which is send afterwards.

In a situation like the one you decribed, I would send an email explainnig that you have completed the work outlined in the initial project breif, and require payment for that. Any amemdments or changes to the breif will be considered a seperate project, and estimated accordingly. Follow up with a phone call.

Good luck.

[BeniCreative]

Originally Posted by Jay

Did you ever have any issues with anyone not wanting to pay upfront because you hadn't worked with them before?

Jay

Hi Jay,

In relation to your comment here, I used to get worried in the same way that if I asked clients to pay upfront they might not go ahead with the work. I have found the ones that have an issue with it are usually the same ones you have money troubles with the whole way through. Implementing a deposit or pre-pay system with signed terms and conditions helps to sift out the clients that are serious about working with you and valuing your services from those people who are very good at avoiding payments. Likely chances are, if they have made it complicated for you, you are probably not the only one.

I think it's also about being confident in presenting your terms. If you are not apologetic about it and are consistent in sticking to the system you put in place, you might be surprised how well people accept it.

Cheers
Bronwyn

[tildavirtual]

I offer a subscription based service or you can pay in prepaid blocks of 10 hours. My clients prefer it this way because they know exactly how much they owe and it helps with my cash flow. There are obviously other benefits for my clients such as priority service and a discount on the PAYG hourly rate.

As long as you are happy with the terms and follow up the non-payers when your invoice is due, then that's all that matters.

[WendyBee]

[QUOTE=Jay;1545]Hi there
Hi Jay,
It's all in the initial agreement I think. Unless the client is somebody I am absolutely sure of I get 50% of the quoted figure up front and the rest on completion. I also try and get it paid by credit card, so I have the number. Be very specific in confirming the brief and about the number of revisions and alterations your quote includes. If they want more, re-quote and get their written agreement. Sounds tough I know but these stalling tactics can be really annoying and cost you a fortune, even your business.

Good luck.

[BrightSpark]

Back in the day when I was doing some debit collections I found that sitting in their front office for awhile tended to make them pay up and if they didn't I would them serve them, normally with a small claims, which tended to make them take notice and then pay.

If they still didn't pay we went to the judge to get an oral examination ordered. All the while their bill is getting bigger and bigger.

When they have to appear in front of a judge and explain why they haven't paid your bill tends to make them think twice and to pay up.

Yes, it has cost you some time and money, but it then gets out that so and so doesn't pay their bills and was taken to court and this way they don't catch another person as well.