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Staring at your empty bank account balance when you know you’re owed money is one of the most frustrating things in the world. If only your clients would pay on time – but it’s not like you can force them, right?
Well, no you can’t, but you can take steps to give you a better chance of getting what you’re owed on time. The following five tips should show clients you mean business about your business relationship and getting paid on time.
1. Ask for a Contract Every Time
Have you ever been faced with the scenario of your brother-in-law asking for you to do some work, or maybe a client you’ve always wanted approaches you and they ask to “forego the contract?” Likely you either feel obligated or afraid you’ll lose out on the opportunity, so you agree to forget the paperwork and just do the work.
But what happens when you need to get your money? Suddenly they also “forego” paying you, and if there’s no contract, you have little recourse for getting your money. No matter who it is, get a contract each and every time you being a project. Not only does a contract prevent problems, it can also give you piece of mind so you can concentrate on the work.
2. Be Detailed
Don’t just throw your contract together at the last minute. Be as detailed as possible about the work you will perform and your expectations for the client. Be specific about dates and deliverables. For example, if the project has multiple parts, include when you’ll turn each part in as well as when the client should pay up. Don’t forget all important payment terms (NET 15, “pay on receipt,” etc.) and a late fee to dissuade slow payers!
3. Accept Multiple Payment Types
One of the last things you want to do is restrict a customer who is trying his or her best to give you money. If you tell them you only accept credit cards and PayPal, suddenly they only have a check. Don’t give them the chance to provide any excuses; accept as many payment types as you feasibly and safely can. Otherwise, it will just be another excuse for them to delay payment.
4. Let Them Pay Up Front
This is a phenomenon that’s practically impossible to understand: some business owners don’t want to take payments from clients even when they offer! However, it does happen. A customer wants to go ahead and pay for the job even though the work isn’t done, but the business owner pushes it away telling them to wait. (This phenomenon seems to occur most often at the end of the year, as the client is getting their tax write-offs in order!)
Look, it’s very noble, but if the client wants to stay ahead of the game on their end, let them! Just let it be further incentive to do a good job on the project and you won’t have any problems.
5. Make Them Remember You
It may seem like another excuse (and it might be), but “I was just so busy” is definitely a reality many business owners face when it comes to their obligations. You know as well as any other entrepreneur that sometimes things just slip your mind when you have 10,000 other tasks you have to accomplish. If a client is late paying, follow-up frequently and persistently. After all, it’s your money.
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