"Sorry, we'll pay as soon as possible..."

[Pat Whatley]

Okay, for a year now I've been okay with our invoicing. Things have gone from averaging 10 days until payment in February to around 21 days in July, all of which I was okay with.

In November the average time until payment crossed the 30 day threshold for the first time ever.

Here in December about half of those November payments are still outstanding...most in the the 45 day range (all our invoices are sent "DUE ON RECEIPT" but I don't worry about them until they are at 30 days) Payments were actually coming in so slow that the mailman didn't even stop all of last week. I called the post office to make sure there wasn't a problem with the mail.

So I spent two hours this morning calling people and checking on them. Almost every one of them said something to the effect of "Sorry, we'll pay as soon as the money comes in."

The one that really pissed me off was an order I did for the county property tax office for $1600. The invoice was sent in late October. Well it turns out that the county is "not paying any invoices until mid to late January"

I'm not worried about getting paid eventually from any of these companies. I'm just wondering what they tell the power company, or the phone company, or their mortgage companies. I' sending out letters today to all my accounts to explain that all accounts must be secured by a credit card from now on. If the bill is not paid the charges will automatically roll over to the credit card.

I'm really, really thinking I need to start growing corn.

 

[TheSnowman]

I'm livin the same dream. Everyone wants me to work for less or free, charge them my cost for materials, and they want it yesterday. However, all my costs have gone up...amazing world we live in. Almost ready to go flip burgers...no one haggles pricing there!

 

[gabagoo]

those are the bills they DO pay as they cant dick them around. I have a new policy with slow payers...C.O.D. club, and I let them know that they have abused their credit and now have none. Dont like it? go elsewhere, they wont give you terms and they dont have your files he he he

 

[DGDesigns]

I am seeing the same thing. It's almost like they're blaming you because their business is slow. I've been sending out notarized letters, certified mail stating that the money will be collected through Small Claims Court if an effort is not made to make payment. It scared the first client and the money started coming in. The second client is about to receive the same letter. You have to go to the Small Claims Court where the transaction took place and fill out a form. If the customer owes you a lot of money you may consider putting a lien on their business; this doesn't guarantee you'll get paid, but if their business closes, you'll be in line to get paid.
It's just a shame that people don't put a value on service based businesses today, but I am hearing it from others as well.
I always try to get the customer on a committed payment plan, just like my dentist would do. There's room for compromise in todays economic climate.

 

[TheSnowman]

Guess what happens when my business is slow...I DON'T ORDER STUFF!

 

[Pat Whatley]

If the customer owes you a lot of money you may consider putting a lien on their business

:ROFLMAO: I don't think any of them will get to that point but it reminded me of something. I know a guy who was awarded a lien against a customers truck he'd done repair work on. That was in the early 1990s. The truck died it's final death about 5 years ago and the owner couldn't even scrap it because of the lien so he drug it over to the side of a lot he owned and it's sat there rusting ever since. The guy that has the lien now gets to drive past it and see it every morning. :ROFLMAO:

 

[Mikeifg]

I'm livin the same dream. Everyone wants me to work for less or free, charge them my cost for materials, and they want it yesterday. However, all my costs have gone up...amazing world we live in. Almost ready to go flip burgers...no one haggles pricing there!

I agree It must be the area we live in. Hell I'm siding a garage for 10hr just to keep busy.......

 

[Mikeifg]

Except for today the winds are 45 plus around here.

 

[DOGraphics]

I'm really, really thinking I need to start growing corn.

Really ? :ROFLMAO:

 

[weaselboogie]

I'm not too concerned for those who are paying late... I understand. What really concerns me are the people that haven't paid yet and I can't help but to think that they might be done with it all. I'm sure a lot of businesses are going to be throwing in the towel after what looks like a dwindling christmas.

I just wish people would be honest and upfront with me instead of avoiding calls, not responding to emails... all that does is piss me off. Times are tough, I understand, I just would like to see some motivation that they're going to pay or even partial payments.

 

[Poconopete]

Pay up front or go elsewhere. This year has taken it to a new level with the excuses I've heard so everyone has been cut off. $$$$ 1st or I'll be the new greeter at Wally World.

 

[heyskull]

I am agreeing with Pat customers also in the UK are getting slower and slower to pay.
To the point we are no longer taking company checques and all jobs must be paid for on completition.
Some of the bigger clients are starting to drag there heals also. So we have incurred a 5% late payment fee on all work. After 60 days it rises to 10%.
The local Council reckons we can't do this too them but business is business.
I get incurred a charge if we are late paying our business rates.
My Lawyer friend says we are within our right as they are to incurr the late payment clause.
I have an Indian Take-Away which we will be removing there signs if it isn't paid for in full on Tuesday.
The guy only owes £100 but this has been out owing since June!
I feel bad about doing this before Christmas but I wouldn't get any sort of credit if I went into his shop and decided I would pay In 6 months time, so he isn't.

SC

 

[anotherdog]

For years we have most of our jobs "pay on approval (by credit card only) or it doesn't get printed". However to grow you HAVE to take the companies who only pay by cheque, only pay when they do a "cheque run" once a month (and the run is always the day before your invoice hits).
It's creeping up on us too. What do you do though?

1. add a little margin to cover all the free credit you are lending out?
Then you risk you priced driving business down the road.

2. add a clause to the invoice, 5% on overdue balances?
Try jamming that one down the throat of you bigger customers.

3. roll over in a sweat at night because so many teetering customers owe you so much, but its now accepted that you can stiff your suppliers for months (except we pay on the nail for all our supplies and get better service because of it).

We (small business) are the new credit elastic in the economy. The source of free credit for other business that these days can't qualify for a bank loan, but can hold you hostage.

Its not just signage though. I have one customer who boasts that he owes his lawyer so much they are taking him to court...so he hires another lawyer to defend...and he has no intention of paying that lawyer either.

sad when the most expensive thing in business is integrity.

 

[Checkers]

From My contract...

"Interest/Fees/Penalties - Outstanding balances will bear interest from Seller’s invoice date at the rate of two percent (2%) per month or the maximum rate permitted by law..."

Checkers

 

[J Hill Designs]

good one

 

[threeputt]

I've said it before and I'll say it again, "the behavior that gets rewarded is the behavior that get's repeated". Simple.

Marking invoices "due on receipt" means absolutely nothing if that same client takes 30 days to pay and you allow this to happen again and again.

I'm not saying we're not feeling the crunch like all of you, but my wife is a good credit manager. When client's want credit, we say "sure, just return this credit app". Anyone with shaky credit won't bother to return it because they already "know".

The solvent, stable clients will return it and she reviews it.

We pay all of our bills on time, everytime. That's because we worry about our own credit standing. That sometimes means we're pulling on our line of credit. Seems to me every business needs a line of credit and I don't see how you can function without one. (unless you're really capitalized)

My advice, and I don't mean this to sound stern, or elitist, is simply...don't offer credit to anyone who you think is not stable and very solvent.

 

[Pat Whatley]

I've also noticed that none of my suppliers have sent me a Christmas card so far this year. Usually they've started rolling in by now. Not that I'm basing purchasing decisions on the quality of cards they send (I base decisions on proximity of contact information) but I see it as another indicator of the state of the industry.

 

[BargainSigns]

We charge 50% at ordering with the balance due upon completetion, without exception. That has been our protocal for the last 7 years and I'll tell you it has saved our bacon on more than one occassion. We used to have a wall of "unclaimed" signs. There is very little I hate more than chasing money.

Have you tried reposessing the sign? I know it sounds harsh but that has worked for us before we got the 50%.

Good luck!

 

[Dice]

We are all Cash and Credit Card here 95%. Anyone that asks for 30 day terms we say sure and hand over a 6 page credit application. Once of the items is a CC secure. There are so many deep questions, five minutes later they hand over the CC and don't bother with it. The ones that do are the good guys and pay at 15 or 30 days so we don't mind extending them credit, we have their CC on file if they fail plus authorized signature to charge a late fee.

We have zero issues with collections.

 

[3dsignco]

payment up front, I have only extended credit to LOOOONg time clients. I have lost a few jobs from this but thats the price we pay. If I wanted to take a chance with my money.. I would go to Vegas.