Chasing payment from client - what do you do?

[flowerybeanbag]

I have a client who has turned into a bit of a bad payer. Apparently a cheque was 'in the post' in September for the last bill. Have chased when cheque didn't arrive but no response.

Had DS2 5 weeks ago so what with one thing and another I let it go temporarily, but now I want to write to him formally. What do you all say/do in similar circumstances? Do you issue a 'reminder' invoice or anything?

I'd send a copy invoice attached to a covering letter saying something along the lines of -

Despite several reminders it has come to my attention that the attached invoice is still outstanding.

Can you please arrange a payment to be made by end of business on 22nd December 2009 - or I will have no other option than to start legal proceedings.

yours blah blah.

are they are one man band, or do they have an accounts department? If the second, ring accounts directly and tell them you are chasing payment for x invoice, and sympathise hugely with how difficult it is when "them higher up" don't pass on info .

If it's just the client themselves, that's more difficult, but try suggesting that as the cheque has obviously got lost during the post strike, they need to make a direct bank transfer, here are my bank details, I'll expect to see the money by Wednesday.

If you're not too fussed about losing them as a client, then be "disappointed" that you're goign to have to switch to pro-forma invoicing in future, as the current arrangement isn't working. That tends to piss people off a bit, so you do run the risk of losing the work. But if they do bugger off and don't pay what's outstanding, then the small claims court is your friend.

For starters you should have sent reminders/copy invoices earlier, at least at the expiry of every calendar month.

I would also do the same as above. Make sure you are prepared to follow it through. Bad payers are like immature little children. Whatever threat you make you have to be consistant and follow throough.

good luck.

Have someone factor it for you?

Yes I do realise I should have sent reminders earlier; as I said, I had a baby 5 weeks ago so have let things slip a bit.

He's not quite a one man band, no, there's a person who pays the invoices but there have been some changes there recently so I'm not sure whether she'll still be there.

I did send a 'cheque has obviously got lost in the post, here are my bank details' email mid-October to no avail then baby took over.

I think a formal letter along the lines suggested by TraceyK is probably the way to go. I'm not too fussed about losing him as a client tbh - he's not been that lucrative anyway and given the circumstances he's in, I think chances of repeat work are not at all certain anyway.

thanks all

Uriel what does 'factor it' mean? Not heard that before...

I wouldn't go down the factoring route personally, it can give you a false sense of security.

Basically a factoring company, RBS do it as do many other banks takes on the collection of your monies. They pay you up front for your invoices minus a commission then collect the money.

Only problem is if someone does not pay then you have to pay the money back. It is meant to help companies with cashflow but time and time again I have seen businesses go under (construction industry) when they have spent money they havn't been paid by the client.

I'd not go to a factor either - I think it always looks bad - as if you are having cash problems - so a bad image to have.

Turn up on their doorstep with baby in tow and make sure the baby is screaming - they might pay you to get rid of you quickly!!

I would ring and then send another letter, I always ring to chase money infact I have made 4 today to the same person, it works I am calling tomorrow to collect a cheque

Ditto. I'd call. And then call again. And the next day. Nothing threatenting or overduly harassing, just saying that the money is overdue and asking to discuss when it will be paid. Speak to the person who actually approves the cheques (almost certainly the owner, in an operation of this size, and ask nicely- but candidly - if there's a problem meeting the bill. You're happy to be accomodating but you need to know what's going on. Can they send you an installment if they can't pay it all now?' etc etc. Almost certainly, in today's climate, if they haven't paid, they can't pay. You'll be one of a queue of people wanting money. Your job is to get to the front of that queue. Yes, Small Claims Court will support you but it takes 4 months to get a judgement, and then you still need to enforce the damn thing - they won't collect for you. And you've lost a client in the meantime. Good luck!

thanks all, that's all really helpful.

(I'm liking the idea of turning up with a screaming DS2...)