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Hello All,

I am asking for your feedback and suggestions about how you enforce payment from your clients. This has all come about because I have clients who owe me money ($1,500 collectively) from May and June for bookkeeping services that I provided for them. I hate to sound greedy but as much as I understand that other people may be having a hard time financially I also need this money in order to keep my own business operating.

 

Here's what I have done: I created statements listing the invoices and respective balances for each month in QuickBooks and emailed the statement with the invoices to each client. I have also provided a payment plan so they can pay off their balances in installments by the end of September.

 

In light of these late payments, I have decided to enforce my policy requiring an upfront payment of at least 25% of the full estimated amount for the work to be done with payment of the balance to be made upon completion of the project but before any hard copies are given to the client. I hope this makes sense to you.

 

Other options I have considered regarding upfront payment is to give a 15% discount if the client pays the full amount upfront.

 

I have read many posts about rates, payments and payment policies. All this information rattles around in my head while I figure out what I want to do to ensure the revenues are coming in for my own business.

 

I would really appreciate your feedback and if you want to tell me what payment plan works best for you, I'm all ears.

 

Thanks,

Barb

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Hi Barb,

 

We have all been there once or twice and feel your pain. Last thing anyone wants to do is ask to be paid.

 

Here's what I would recommend:

1. You have sent them a payment notice so they are informed that their payemnts are late. You were generous with payment plan ;-) I am a little harsher with mine but why? because I was burnt once!

2. Stop all work immediately and inform the clients (was not clear if you were still doing work)that until payment in full is made you will not be continuing to do work.

3. If it was in your agreement - any items they require hold onto until payment is made.

 

Your new policy ideas sound good to me I would follow them.

As long as your agreement in clear that when payments are owed no work will be completed you should not be out much money if it happens again.

 

 

Good Luck!

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No payee, no workee.

 

Every. Single. One. Of. My. Clients. Prepays. PERIOD.

 

For bookkeeping services, I'm assuming (since I don't do bookkeeping) that you have a set series of tasks, you know how long it takes, therefore, you should know how much time you would spend every month. Sure, some months may be a bit more, some less, but basically it would all even out in the end, right?

 

Therefore, if you know what your client wants you to do every month would take ten hours, then you ask for 10 hours paid UP FRONT. If you don't spend 10 hours, but 9 instead, then they could get a credit for the next month. If you wanted to do that.

 

But say it with me: NO PAYEE, NO WORKEE.

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My bookkeeper has an agreement with me that at month end she automatically withdraws her monies owed to her for the month from my bank account directly, through Paypal or charges it on my credit card. Last day of the month I always received a paid invoice from her.

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No payee, no workee.

 

Every. Single. One. Of. My. Clients. Prepays. PERIOD.

 

For bookkeeping services, I'm assuming (since I don't do bookkeeping) that you have a set series of tasks, you know how long it takes, therefore, you should know how much time you would spend every month. Sure, some months may be a bit more, some less, but basically it would all even out in the end, right?

 

Therefore, if you know what your client wants you to do every month would take ten hours, then you ask for 10 hours paid UP FRONT. If you don't spend 10 hours, but 9 instead, then they could get a credit for the next month. If you wanted to do that.

 

But say it with me: NO PAYEE, NO WORKEE.

Love your style Dana :)

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Best of luck to you Barb, that's terrible, but it sounds like you have some great advice that we can all learn from here.

 

 

Dana. I. Love. Your. Style.

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Hi Ladies,

Your responses are fantastic.

 

I did send a notice that their payments are late. I have heard back from 2 of my clients; still need to hear back from 1 more. Another client called me today to advise he is sending me a cheque.

 

I'm getting the drift and feeling more assured that upfront payment is the way to go. 'No payee no workee'. I love that phrase! It makes me chuckle :thumbup: but it's so true. (Every. Single. One. Of. My. Clients. Prepays. PERIOD.)

 

Also I like the idea of an agreement between me and the client that I can withdraw the money owed to me each month through Paypal either from their bank account or charge to their credit card. I'll give that a shot.

 

I know what I have to do now.

 

Thanks,

Barb

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To All

 

Since I have just started my business and have no clients yet, this information is very useful for me. I appreciate being able to hear from those with experience on how they are addressing this issue.

 

Sincerely,

Linda

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