Non Paying Client 3

[bigmig]

I have a non paying client (5 months late) who is a contractor. In order to work with them, (they are a national disaster restoration contractor beginning with the letter B)they pretty much said they would not sign my typical contract, which specifies payment condtions etc.

In short, I have no way of getting my money other than constantly calling them by phone or physically going to their office... which isn't working. The invoice is small, thank goodness, but the principle makes me a little mad.

Has anyone ever gone to the building department and pulled their plans over non-payment? I've heard it stated before, but wanted to get some more specifics.

 

[bigmig]

kylesito,

I guess I don't know why anyone would call a client and say "I have been spying on you". The email tracking is simply the opportunity for more information, in an effort to make you aware of the information that impacts minor things on your jobs....like getting paid. As everything, I'm sure some idiot could find a way to mis use it. Personally, the more I know about a situation before I walk into it, the better. As someone else pointed out, the image dis abler does negate these trackers.

The topic of lack of professional and responsible communication between design professionals in our industry is for another post. The email tracker just underlines the fact that so called professionals sometimes are the worst at communicating, much to the determinant of their jobs and our profession.

 

[Triangled]

Collections are critical to running a business, but not to running engineering calculations, which are two completely different things. If you happen to be wearing both hats (lucky you!), suggest you create a simply (simpler the better!) managed system which shows you all invoices and their ages at a glance and then develop a routine follow up procedure for, say 30 day invoices, such as an email at 4th week, "may we expect your payment this week?", another at 5th week, a phone call at 6th week, and then a phone call etcetera. Do, or have your assistant do, your collection follow ups at the same time every week so it is a routine. The squeaky wheel gets the grease. A simplified and systematic routine reduces your inner stress. Such a routine will reveal any problem accounts (may they be few and far between!) much sooner. Understanding the timing of your state's lien rights and having a relationship with an attorney empower you when the good relationship with your client is not enough. Watch out for those that only pay upon an attorney's letter as they are likely in a position of robbing Peter to pay Paul, and you, squeaking very loudly through your attorney, got the grease while almost certainly other vendors of that client did not.
Good luck!

 

[rjoto]

develop a routine follow up procedure for, say 30 day invoices, such as an email at 4th week, "may we expect your payment this week?"

It's not clear to me, but if that's the 4th week after the invoice date, good luck with that. I have yet to meet a company that pays their invoices before the due date. You'd likely be annoying a lot of clients who pay things right on time.

 

[msquared48]

For years, I had an unsheathed Bowie knife mounted to the wall of my office, labeled "Collection Department."

Never had a problem...

Mike McCann
MMC Engineering

 

[CELinOttawa]

I have taken to giving discounts for early payment... In effect we've spread a part of the value in using our small firm to prompt payment (what the CRA classes as an early payment discount), and as a result we never have to chase anymore.

 

[berkshire]

CELinOttawa (Structural)
Watch that like a hawk, the bigger companies will pay late and take the discount, If you let them get away with it once, guess what?
B.E.

You are judged not by what you know, but by what you can do.

 

[Compositepro]

Doesn't anyone here use Quickbooks in their business? It won't collect debts but will allow you to easily track invoices and late payments.
I sense a somewhat naive attitude about payment terms in this thread. 30 days net terms are common and are what I generally use, but they can be anything that is agreeable between two parties. If you, as a small business are short of cash, you should not be making loans to your customers. Getting down payments or retainers is the ideal way to go. Financial risks are minimized and shared by both parties.
If you have little cash, and borrow to be able to supply a product or service to someone who cannot make a down payment because he has no cash, you are taking a big risk of financial disaster. When something unexpected goes wrong, everyone loses.
When I was starting out (in a very specialized business), I had a customer (who knew of me) that was willing to pay up front for some very large orders. Some years later I was doing very well, and that customer had cash flow problems. I was perfectly happy to return a favor and wait 90 day to get paid. Good business is about relationships.

 

[CELinOttawa]

Berkshire: You're right, of course, and we have had people try to pay late but avail of the early payment... Just sent another bill, which was paid. I'm sure it will eventually cause its own problems, but so far, so good.