Rant!! Clients that do not pay invoices

[topduarte]

Been on my own for about 5 months now and learning the hard way with some clients!!!

Offering engineering services here (Texas PE here) and made some decent contacts but it seems that when people want advice or sign offs on needing a PE, they call ASAP and I deliver!!

But when I send invoices, they ignore emails, phone calls etc.

My wife said to be more harsh and now have asked for a retainage upfront. Asking my brother (lawyer) to review my contracts now to protect me.

Sorry for the rant but when bills are tight and I am short $3800 due to me and they are over 30 days late, it sucks!!

Peace!!

[wes122984]

i know man...got 40k in collections from this and last year alone

[wes122984]

add ridiculous late fees and put liens on homes

[cfortner]

My BIL is in the same scenario. Building fences for home builders and at any given time they are - $100-300K +60 days on net 30 terms. I keep offering to help my TBH brother Heath out and bring out the Louiville Slugger on em but still haven't got the go ahead yet

[wassaw]

I'm seeing it also, if you have net 30 they take it to 60 and so on. some are robbing Peter to pay Paul. Seeing more and more pay on credit card each order also.

[Soapeddler]

My delinquent list has really grown in the last 6 months - and the ones showing up are clients that I have had for YEARS and never saw them on this list before unless an invoice just slipped through the cracks - which does happen on occasion. Our terms are net 10 - if they don't pay within 30 days they show up on my list.

[huntinfool]

I would be extreemly happy if we were only 30 days out. Sometimes we get 6 months out. One of our "customers" is real bad. You have to rely on someone else to send off the paperwork to their corporate office and then rely on someone else to process that paperwork. Then you have to rely on someone else to cut the check and put it in the mail. There are too many cracks for this to fall through and it usually does.

[hoythunter]

It's pretty basic. People don't care when they don't need anything from you. Stop services to them until they pay and you'll get action.

[trailboss]

I feel for ya man. Saw my dad go through that in the service station business. Fortunately, that's one problem I don't have in the insurance business. If they don't pay - they don't have insurance and there is no room for argument. Good luck with the collections.

Trailboss

[extremehunter]

Bout all you can do is get a judgement against individuals which doesn't do much good.Work for major oil companies and they party on my noney while the babies go without shoes.

[Shadow]

My brother does specialty electrical stuff with touch screens etc... when he writes code for the touch screens he always codes a timeout period. This timeout period coinsides with payment terms. He does net 30 and if not paid on time the timer disables functionality which then gets a phone call to him to repair, naturally there is no charge for this repair but account must be paid in full prior. This is also writen in the contract that safe guards are built into the software to ensure account accountability and currency. Now if the client pays upfront no timer gets put in. If the client pays on time he usually stops by for the health check at no cost and disables the timer.

This has worked out really well for him.

[Charles]

It's a snow ball effect. Here's what I do to keep it in check!

Stay on top of it. We call and send emails daily. The longer you let it slide the more difficult it will be to collect. What's the saying "give them an inch, they will take a mile".

If the calls and emails don't get a response I show up to their office unexpected with all invoices owed. More than likely they will say the person you need to talk with isn't in. Sit down in the lobby and tell them you will wait for them. Than start calling people (I always call the office and buddies) at some point state that your at a clients office attempting to collect on past due invoices. At this point someone who can write a check will show up (the company doesn't want employees to know they arn't paying their bills and they ceratinly don't want clients to over hear this). I've had great success by doing this.

Next step is my attorney will send a demand letter that in a nutshell states "you better pay this by a certain date or it's ON"!

Lastly, I have the ability to log into their network to negatively effect the performance! The only way to correct the problem is to bring me "cash"!

I also require retainers on larger projects. If we receive a call out of the blue from a new client requesting service work quickly they are COD.

Be sure and provide over the top service for the good clients. The dead beats can be replaced easily.

[BIG D]

In my line of work, I dont get my commission until my customer pays their invoice and in my line of work, customers paying in the 20-40 day slot are few and far between. Most hang out around 60 days and then need a good push to get it then.

[grizzlyman]

If you are doing commercial work familiarize yourself with Title 53 of the Texas Property Code, the Miller Act, and the old Mc Greggor Act (they call it something else now days..I think it is title 2153). I don't recall exactly, but I believe engineering services are included in these. Notices of Intent to Lien are usually sufficient to make people pay, but occasionally you have to file a lien. If you have all your ducks in a row, a decent attorney shouldn't charge you over $200 for that. Like I said, you shouldn't have to do it more than once, and the word will get out.

[Tuffbroadhead]

My brother does specialty electrical stuff with touch screens etc... when he writes code for the touch screens he always codes a timeout period. This timeout period coinsides with payment terms. He does net 30 and if not paid on time the timer disables functionality which then gets a phone call to him to repair, naturally there is no charge for this repair but account must be paid in full prior. This is also writen in the contract that safe guards are built into the software to ensure account accountability and currency. Now if the client pays upfront no timer gets put in. If the client pays on time he usually stops by for the health check at no cost and disables the timer.

This has worked out really well for him.

Very smart...and great idea