Nothing is more disconcerting than a customer who refuses to pay for quality services rendered. You’ve worked hard, but you’re not getting the reward. It can be heartbreaking. Fortunately, there are steps that you can take to ensure that you get the money you’re owed, no matter what your industry. Check out our ideas below:
If a client refuses to pay you according to the schedule you initially set out, stop working immediately. Don’t continue toiling in the hope that you will eventually get paid. The reason you should stop working is because it helps you set clear boundaries. Clients who believe that you are a pushover may continue to ask you to work, even in the absence of any pay.
Leaving a project unfinished puts the client in a tricky position. They could try to find a workaround, but usually that’s not possible. It improves your bargaining position and makes it clear that their actions are unacceptable.
Charge Late Fees:
You can also try charging late fees. Late fees encourage clients to get their act together and to pay payments on time, instead of waiting for fines to accrue.
Work With An Industry-Specific Collection Service:
You can back up your efforts by working with a company that specializes in recovering payments. Many CBD firms, for example, use a cannabis collection agency since they understand how the industry works. Collection agencies reduce the hassle of collecting payments yourself. You don’t have to personally call clients and demand money (which can be emotionally draining). Instead, experts do it all for you.
You can also use a factoring model. Here, third-party companies buy your accounts receivable off of you and then pursue money collection themselves. Prices for this can be quite high. Usually, you’ll receive around seventy percent of the value of the invoice. However, at least it provides you with cash immediately, instead of having to wait for months, meaning that it is great for cash flow.
Making contracts in advance helps you to avoid late payment problems. By spelling out precisely what each party can expect, you have legal recourse should your customers fail to pay you at a later date.
If customers won’t pay you, find out why by asking them. They could provide all manner of reasons – and you won’t necessarily know what they are in advance. In some cases, they might cite their own poor cash flow, in which case, debt collection might be the only option. In others, they might tell you that they’re not happy with the quality of the service. If there is a problem, try to find out specifically what it is so that you can correct it. Often, once you solve customers’ problems, they are more than willing to pay you.
Non-paying customers can be stressful. But, fortunately, you have many options. You can explore the issue more, find out what’s gone wrong, create incentives to pay on time, and even hire legal help.
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