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  • #965067
    Easy Workplace Safety
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    Hi

    I run a small OHS Consulting business with some national clients. I currently have a problem with one of my clients not paying their account.

    My Process: I send a proposal to my clients with details of the service, the costs and the payment terms (7 days). I require a deposit before I commence work. All was going very well 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 might point out at this stage that he is in the medical profession), I agreed to a monthly repayment plan. I sent him 2 lots of OHS Documents at regular intervals. He paid quickly on the first 2 invoices however he has gone to ground in the last 5 weeks. I sent another invoice 2 weeks ago and have had no communication from him in any form since late May.

    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 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?

    #1009858
    whateverbusinesssolution
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    Hi Donna,
    Sorry to hear about the situation…

    Is he amenable to meeting with you to discuss precisely why he is not paying? Is it a cashflow problem that could be solved by a payment plan?

    I’ve often found that communication is the key to resolving these issues.

    Alternatively, it may be that you will need to start legal proceedings for recovery of the debt. Your legal options will vary according to the amount of the debt and the type of entity. May be time to consult your lawyer.

    You may also wish to review your trading terms & conditions to see if they can be improved to incorporate things like Retention of Title (if applicable) or charging clauses (again if applicable) to avoid a recurrence.

    #1009859
    DebtCollector
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    Hi Donna,

    I always say if the debt is over 60 days old it’s time to take affirmative action.

    We are a debt collection company. If you need any advise contact me on the email/numbers below.

    #1009860
    LeelaCosgrove
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    Time to get tricky!

    Step 1: call from a phone you don’t normally call him from. DO NOT call from a private number, because he’ll just avoid and if you call from one he knows is you, then he’ll also avoid.

    Step 2: don’t ask for the money. Instead, find out what’s going on. Tell him you understand that he is a man of his word and that he would have paid you if he had been able to. Tell him you are cool to delay payments and work stuff out – you just want him to communicate with you and let you know what’s going on. Be flexible, but most importantly – give him a way to back down while still SAVING FACE.

    What happens in these situations is simple. People’s cashflow sucks and they are embarrassed. He wants to appear like he’s doing well, not like he’s suffering and he’s afraid to admit that he’s hurting. Give him the chance to work it out AND To save face and you are more likely to get a satisfactory outcome.

    Step 3: Follow up with him regularly in the same way. Check how things are going. Ask if it’s okay for you to send through the next invoice. Ask if he needs help, if there is stuff you can do.

    This is how you win long-term business and raving fans.

    #1009861
    Easy Workplace Safety
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    Great advice. Thank you so much.

    You are so right in saying that communication is the key and I think that is what is so frustrating.

    I have been careful in my calls to him as they have all been focussed on my concern about his receipt of the confidential documents and to ensure he is OK. I have asked him a couple of times if he could indicate when he is likely to make the payment however still no reply.

    As he is opening a new clinic, I am sure he has an enormous amount of debt hanging over his head so cashflow may be the issue. It is getting him to talk to me which seems to be the problem for him. I am very easy going so from my point of view I cannot see the problem.

    I will give him a ring from my husbands phone or better still, I will get my husband to give him a call.

    The suggestion of reviewing my terms and conditions is also a good one so thank you as I will certainly follow this up.

    Thank you for the great suggestions.

    #1009862
    Jexley
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    Geez, all the stuff I’d had ready to say was covered by Leela, so I’ll just reiterate that you need to get a hold of this guy and give HIM the power by saying that you understand whatever circumstances he may be going through, but that it is imperative that he attempt to work something out or you’re going to kneecap him.

    Okay, maybe not threats of physical consequences, but it could be implied… heh.

    Good luck, and let us know when it’s sorted.

    #1009863
    Easy Workplace Safety
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    Thank you for the support.

    I have taken all the advice offered and the saga continues. Have left further messages today on a different number along with a friendly email.

    Will see how this goes and if no communication in next few days will have to take further action.

    Will keep you posted.

    #1009864
    LeelaCosgrove
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    ROFL …

    I almost wrote:

    Step 4: If you don’t get your money, send some guys around to kneecap him … but I didn’t want to be accused of inciting violence …

    #1009865
    Easy Workplace Safety
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    I have a few options available to me – maybe this is one I could add! LOL

    All very frustrating when I am being so nice to him and giving him the benefit of the doubt – nearly time to bring out the top guns and get some action happening.

    #1009866
    RMDesign
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    Sorry to hear this is causing you so much stress!
    I don’t really have any tips for this scenario.. but wonder if the business practises of one of my suppliers might help for the future?

    They offer “discounts” if invoices are paid within the set period.
    I’m sure this is built into the price though – so essentially acts as a surcharge for late payment.

    They then contact you with a friendly reminder the week before the invoice is due to remind you of the “saving” – it gives them a good excuse to put their foot in the door and make contact with their “good guy face” on as they are saving you money. :)

    #1009867
    The Internet Bloke
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    I would endorse Leila’s approach.

    If this is not successful, I’d get a bloody big A-frame sign and stick it on the roof of a car or van, and park it in front of his surgery.

    Write some suitably heart wrenching plea on the sign that will embarass him.

    Just leave it there for the day. I’m sure he’ll call :)

    (I haven’t actually done this, but have heard that this tactic worked wonders when used against dodgy car dealers, etc. )
    If you’re legally parked, I don’t think that the police could give you any grief either.

    Cheers, Eric G.

    #1009868
    Burgo
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    You have two choices either call in a debt collector or forget it.

    Dont wate time on these scumbags move on

    #1009869
    BrightSpark
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    Check out http://www.sunshinecoastdaily.com.au/story/2009/09/10/whats-his-beef/ proving that it does pay to stand out in front of their building.

    The other one I have heard of is you accidentally add a couple of 0’s to the bill like the decimal point is in the wrong place and send the bill. They ring up complaining about the error and while they are on the phone you get their card number etc.

    #1009870
    Jake@EmroyPrint
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    I’d be careful with some of the “creative approaches”, as there are strict guidelines on exactly how outstanding invoices can be followed up.

    I believe in fostering long term relationships with clients and giving them opportunities to make things right (Which by the sounds of things you have done) But I guess, as much as it hurts, sometimes we just need to accept the reality that some people don’t pay invoices and experts need to be called in to assist.

    #1009871
    soliddata
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    Some interesting approaches outlined – some pretty funny (and if you do them you must post photos here…).

    Anyway, I found the letter from your solicitor is a great start, and using the debt collector is essential.

    You need to have a structured approach to invoicing so that they always get followed up and escalated at set days-after-invoice… for ALL customers.

    Also, work out now if there is a type of customer likely to become a bad payer, ie. what would you look for when starting to do work for them, so that you can see them early and not take them on next time, or give them zero-credit terms etc.

    Kevin

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