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When customers don't pay

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  #1  
Old 03-19-2003, 12:14 PM
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chiquitita chiquitita is offline
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When customers don't pay

Has anyone had trouble getting payment from a customer and what did you do?
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Old 03-19-2003, 02:13 PM
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Blacknight Blacknight is offline
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When I had my business up and running, I would email a proposal (and a low-quality jpg version with PROPOSAL "stamped" on it) and state that the total cost to do the job entailed a deposit of half the total proposed. This effectively weeded out those who had no intention of paying, and even if it didn't, at least I'd have SOMETHING for my efforts. Hope this helps.
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Old 03-19-2003, 07:51 PM
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Jakaleena Jakaleena is offline
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I'm with Phil on this one. I require a 50% deposit up front. The balance is due upon delivery of the finished work.

Make sure you give them a receipt for the deposit, which also states the balance due and the approximate date the work will be finished. That way, if you need to, you can turn the account over to a collection agency because you'll have proof that they owe you a debt.

With local people, it's easier because you don't give them the work until they've paid the balance. With customers by mail or internet, the collection agency thing will sometimes light a fire under them (make sure you warn them that you will turn the account over for collection before you actually do - collection agencies charge a % of whatever they recover and you can sometimes just get payment by "promising" to turn the account over to one).
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Old 03-20-2003, 04:01 AM
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chiquitita chiquitita is offline
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Unhappy

jeez - I just typed this long post and lost it....

I think what I was saying was that I have 3 or 4 customers significantly overdue in their payments. I have sent them notices, past due notices, etc. I called one of them and got the old "The Check is in the mail" BS. It is so frustrating, not only because I am really low on money, but that I put my heart and soul into this and talk so much with them throught the process, and even get really positive feedback, and then they just drop off the face of the earth. I can't believe how dishonest people are. I guess I just need to be more cut-throat.

I am going to start taking credit cards and requiring that info before I send them anything. This is rediculous.

In the meantime, does anyone have any recommendations on what else I can do to get my money from the previous clients? Can anyone recommend a collection agency. I am not going to just let this go. I am really disgusted.
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Old 03-20-2003, 05:38 AM
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chris h chris h is offline
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What percentage does a debt collector charge in the US ? I've considerable experience in resolving overdue accounts but not much use in the US as legal procedures are probably completely different.
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Old 03-20-2003, 08:44 AM
john_opitz john_opitz is offline
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Hello Chiquitiita,


Are you giving the customer the product before the final balance is due?

Like the others said, get a 50% deposit,up front. Or a deposit to cover your cost end,at least. "If" their is money due on the order and the customer does not have the "product". Their is not much you can do to collect. Because, they don't have that product. Even though their is money due for your service. You might want to check into your "state" and "local" laws on that. To see "your rights". I'll tell you though. It's easier if your a freelancer(doing it on the side) than a business(store front) with those state and local laws.
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Old 03-20-2003, 02:03 PM
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Aric Aric is offline
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If you make it a policy that you take 50% up front, couppled with a policy of only taking credit cards, then you could aliviate a non pay situation.

The only two bad things about this is the percentage that is taken from your credit card merchant and the fact that a customer can dispute a charge.

But to me, it is worth it as I have the money I earned in my account.
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Old 03-20-2003, 02:13 PM
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chiquitita chiquitita is offline
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I understand what I need to do in the future, however, I need to know what I can do now - Yes the customer has their finished product.
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Old 03-20-2003, 02:18 PM
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Aric Aric is offline
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If they owe you a good amount, then you can take them to small claims court, or threaten to ruin their credit rating by selling your accounts receivable to a collections agency.
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  #10  
Old 03-20-2003, 08:32 PM
john_opitz john_opitz is offline
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The thing that comes to my mind is. 1) Don't give the product to the customer,until the customer pays in full......... more so, if you work out of your home. I don't know how/where the transaction took place. But, the question I'm going to give you and something for you to think about is......See....I don't know, from your post, if your a storefront or you work out of your home. But either way. Was there any signed documents(signed document by that customer) that this work was done and/or be done at all? When you gave her/him the finished product, did you have he/she sign any paper work that states,he/she is to owe this money? This person, can now turn around and say they have paid you.....If their is no signed paper work and no paper work kept on this transaction.... BTW, I'm not saying you did wrong. I feel that was nice of you to do that. But,next time do a layaway. But make sure you keep,paper work and have them sign "ALL" transactions.
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