Discount on invoices - advice needed.(12 Posts)
My dh and I run our own small company. We have done work for a large contractor over the past year or so. The contractor has been awful with late payments but because they kept us busy we stuck with them. However, we have three remaining invoices from this project which are overdue. The contractor is asking us to knock £4k off the invoices, as in their eyes, they have given us lots of work.
We obviously don't want to do this as £4k to us is a lot of money. At the moment we are going through a punch point so need as much cash as we can get. They have caused us nothing but stress getting payments from them. We even had to get a loan out to cover a late payment. We have said that on future projects they can have a prompt payment discount but they keep coming back asking for this money off. They obviously won't pay the outstanding invoices until we agree.
What would you do? We are currently working on another project for them so they could drag their feet paying for this work. I really feel like the contractor has us over a barrel and is bullying us into giving them a discount. Any advice would be much appreciated.
It's shite being self-employed or running your own business.
Nobody can tell you what you do but there are a few things to consider - could you manage without this contractor's business? How hard would it be to pick up work elsewhere? If you agree to a £4k discount now, how long is it going to be before they come back and ask for a bigger discount next time?
It's certainly going to damage trust and your working relationship with these people however it plays out. I'd also be concerned that they're looking for discounts and paying late because of their own cashflow problems - are there any alarm bells ringing with the state of their own business?
What does his contract say?
What % of the money owed represents £4k?
The 4k is about 8% of the overall project. To be honest I just want what they owe us and then that's it. We don't want them as a client. This is a major house builder in the UK arguing over £4k when they make millions from their properties! It makes me so angry. It's just I really don't know how we are going to get our money from them without making the discount.
Take them to court if they won't pay is always an option.
If you aren't going to do any more work for them (and I wouldn't either) then it may be worth offering the discount in return for payment within 7 days. Purely because legal fees to recover the money through the courts (which seems to be the only other option) might well add up to more than that.
You have my sympathies, working for larger firms can really suck. They know very well what they are doing to people like you, and they just don't care.
If you have access to legal advice, I'd run it past a solicitor first though. Whatever choice you make, you need to be sure it won't come back and bite you later.
Do you have contracts with the agreed prices and payment terms? If you do, I think it’d be simple to take this to the Small Claims Court.
Sorry you’re going through this - what a pain. I hate how big bully businesses sometimes try to screw over little independent companies.
No! Why on earth should you? Threaten him with small claims court. You can claim up to 100K there.
I'd put all your energy into finding better new clients as well. Clients like these are worse than useless. They cause so much stress.
I'd also name and shame on Twitter. Post some of their threatening emails to you. I would. If they're a huge housing company, it might hurt them - terrible publicity. They should be ashamed of this behaviour.
But White Horses... being self-employed is all about reputation. OP has to tread a fine line between being assertive and getting what she's owed and not getting a reputation as an arsey troublemaker. I would never make derrogatory comments about a client on social media, however awful they are.
I do feel like naming and shaming but we need to be careful as we are on an ongoing contract with them and we have yet to invoice them as we need to wait until end of the month. I need all our invoices to be settled before I give them a reason to not pay. I am so stressed with it!
Agree with poppy. We don't want to be the company that causes trouble. I just want our money. I think if we weren't having a cash flow issue as the moment I would just give them the discount but that money would really help us. On the other hand, them not paying anything could result in big problems too! Argh!!
But White Horses... being self-employed is all about reputation.
Yup, thanks. I know that. I'm self-employed.
I would never make derrogatory comments about a client on social media, however awful they are.
Well, that is a last resort. But OP has tried several other things that haven't worked.
It's not fair that big companies get to behave like this. I don't think that asking for money that OP is owed, and which is late, and causing OP cash flow problems, is being 'arsey'.
The contractor is trying to bully OP. That's not fair either. Social media is a good way to get your mesage across. Perhaps just the threat of SM would be enough.
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