It can be very frustrating when you have clients that refuse to or are seemingly unable to pay on time. It can also threaten your business if you are unable to collect on the work that you have done or products that you have shipped. Here are some great tips to help ensure that you get what you’re owed.
1. Get yourself in the right mindset
You need to get yourself ready to deal with someone who will try every trick in the book to get out of paying you the money that they’re owed. You should get ready for emotional responses, angry responses and even apathetic ones. The important thing to remember is that you are owed money and you deserve to be paid for your efforts. If you are not the best negotiator or diplomat, you should seek out a professional that can take this burden off your shoulders.
2. Don’t let anyone slip through the cracks
If you have a lot of customers that you have to keep track of you don’t want to let anything slide or miss out on money that you’re owed. The first thing that you need is a way to keep track of all of your customers. You should mark it down in your calendar to follow up at the 15, 30 and 45-day mark. You need to stick to this for all clients.
3. Begin with a reminder letter
Letters are a very polite and straightforward way of letting someone know that they are delinquent in their payments. At this initial stage, it could be a simple, if annoying, oversight on their part. A letter can be the best possible way for you to achieve the goal of getting more clients to pay as soon as possible. The letter can be polite and direct, without being threatening.
4. Maka phone call
If you reach the 30-day mark and there has been no payment, now is the time to pick up the phone. Phone calls are a little more delicate as you don’t want to be misunderstood yet you are asking them for something that they may not be willing to do. In the back of your mind you will also be concerned about maintaining a positive client relationship and the person on the other end of the phone knows this.
5. Don’t threaten the client or get angry
At this point, your goal is simply to figure out what the problem is and how you can possibly get paid. Assess how valuable the client is to you, how likely they are to recover from the current difficulty and become a paying customer once again, and how much of the money owed you can reasonably hope to recoup.
6. Get lawyers involved
If you have reached the 45-day mark and there is still no payment you should consider taking legal action. At least have a debt collection lawyer involved to see if that triggers the response you need from the client.
7. Hire a collection agency
Collection agencies typically take a percentage of the money they recover for you. This is not the best outcome, but at this point, you really do need to make sure that you recoup some of your losses so that you can protect your business and you have not lost any money on the deal. Usually, you won’t have to push a client this far but if you do, you should consider that their refusal to pay is a strong indication that you should no longer have them as a client.
