Overdue Client Payments - Assistance Please

[Easy Workplace Safety]

Hi

I run an OHS Consulting business developing and implementing OHS Management Systems for small businesses.

I currently have a problem with one of my clients not paying their account.

The way I work is that I consult with my clients to see what OHS system they need, then provide them with a quote including a deposit, payment terms of 7 days and details of the work involved.

All went well with this client and I met with him in person to review the plan. There was no problem, a deposit was paid and the project was started.

As he was just starting his business I agreed to a monthly repayment plan. He paid quickly on the first invoice however communication from him ceased about 5 weeks ago. I sent another invoice 2 weeks ago and have still had no communication from him.

I know he is still around as he now has a website up and running and despite my pleasant phone calls and follow up emails, he is not communicating with me. He owes quite a substantial amount of money and I am not sure what to do next. I have not sent him any more documents until I hear from him.

I operate an honest business and feedback from my clients is excellent. This is causing me sleepless nights and my stress levels are growing daily.

Can anyone assist me?

[Leap Media]

Originally Posted by Easy Workplace Safety

Hi

I run an OHS Consulting business developing and implementing OHS Management Systems for small businesses.

I currently have a problem with one of my clients not paying their account.

The way I work is that I consult with my clients to see what OHS system they need, then provide them with a quote including a deposit, payment terms of 7 days and details of the work involved.

All went well with this client and I met with him in person to review the plan. There was no problem, a deposit was paid and the project was started.

As he was just starting his business I agreed to a monthly repayment plan. He paid quickly on the first invoice however communication from him ceased about 5 weeks ago. I sent another invoice 2 weeks ago and have still had no communication from him.

I know he is still around as he now has a website up and running and despite my pleasant phone calls and follow up emails, he is not communicating with me. He owes quite a substantial amount of money and I am not sure what to do next. I have not sent him any more documents until I hear from him.

I operate an honest business and feedback from my clients is excellent. This is causing me sleepless nights and my stress levels are growing daily.

Can anyone assist me?

I'd be heading to Prushka or another debt collection agency. The longer you wait, the harder it is to get recourse.

[Dardee]

How stern has your follow up correspondence been? Have you threatened legal action? Are you prepared to take it that far?

[Army of One]

Get a good debt collector.

Give a final warning letter and follow up call / message + email saying payment must be made by XX date or it will be referred to a debt collector. Ensure you follow through with it.

I know this is difficult - but don't let it shake your confidence. I can sympathise and know how frustrating it is when people do not communicate with you!

Other ideas moving forward:
Maybe also have your 'terms of trade' looked at and updated if necessary - ensure it is all incorporated as part of your quoting process.

Have you looked a fee payment service where you get paid upfront but your clients pay it off over 3,6 or 12 months? We sometimes utilise Smartfee which provides this service in our industry - but there are others.

Hope it turns out for the best (for you - not for your them!)

[TSH-SR]

I have no problems with the other comments BUT - have you taken the time to just rock up, walk in the door and have a yarn to the guy, if he is busy, it may have got to the point where his cashflow is strapped, the bills have got away from him and he may be very embarrassed and not sure what to do himself.

Walk in and sort it out today or tomorrow - it sounds as if you might find this difficult to do, it is very difficult to confront this issue, but you must do it and the sooner the better. Too many businesses procrastinate over this issue and suffer severely for it.

The next thing to do is make sure it is very unlikely to occur with your other clients on terms. I have heard people say over the years that they will not deal with new businesses for this sort of reason. I think you need to be a bit more hands on and in the face of new businesses, get to know a bit about the principals before you offer them too much.

Let us all know how you get on with it.
Regards Tony

[Webolution]

That site looks interesting. I just tried to register but apparently my ABN isn't found. I'm sure it does :-)

Is the lookup using the ABR webservice for checking ABN's I wonder?

I'll keep an eye on the site as I would definitely consider it after other options have been exhausted.

[Webolution]

Originally Posted by tigersafari

The didntpay.com.au website only permits companies to post and recover debts ie you must have an ACN, not merely an ABN. I hope this is helpful.

Fair enough. Not sure about the bit that says "Enter your Company ACN/ABN or Name"??? That indicates an ABN is fine.

Will be interesting to see how the site goes.

[Credit Manager]

Hi Easy,
May i suggest offering a payment arrangement?
If your debtor is experiencing tough times, it may be a way for them to save face and avoid the need for formal recovery action.
I have used these with a great deal of success i the past.

Naturally, make sure you have it documented properly.
Regards
Paul Reynolds
www.nbservices.com.au

[Accounts Studio]

I would certainly be sending letters of demand - quite often these result in payment. But I also have clients who I know avoid talking to people they owe money to until they actually have the money to pay them - which is crazy as most suppliers are happy to talk payment plans. But if he is not returning your calls then I would start following up by legal letters and contact a debt collector if that does not work.

Good luck

[King]

I like the idea of fronting up and asking if he has a problem with repayments or cash flow.
Then maybe reiterate the payment terms that you have and his obligation to meet them, and then, if things are not going well, then mention that if payments are not made, then you will refer the matter for legal resolution (this starts with the debt collector).

Increasing levels of pressure is my advice.