Getting paid for consulting work can sometimes be a challenge.
And it often seems like the largest clients are the slowest to pay.
Here are some tips to help you get paid quicker:
5: State your terms
If you don't put them on the invoice, they'll assume. And that might mean 60 days, 90 days, or longer!
4: Set a date
Even if you have your terms, put the specific due date for that particular invoice somewhere large and visible.
3: Have a penalty
Make sure you have a stated penalty for late payments (usually 1-2%/month). And if they're consistently late -- charge it!
2: Remind them
Sometimes invoices get misplaced or misfiled. Make sure you track when they're due and remind your clients about upcoming invoices and the penalties they'll face if not paid on time.
...and the number one tip:
1: Put it in the contract
Make sure your terms, penalties, and all your invoicing policies are listed in the contract your client signs at the beginning of a job.
#3 has always not sat well with me. I agree it should be in there, but its influence I believe is minor in most cases.
ReplyDeleteAnother one that is really important I find, is getting a deposit up front, even if it for a small amount. It shows committement. Doesn't really belong on this list though.
I've personally found that enforcing a penalty can be the only way to change a consistently late client's payment habits.
ReplyDeleteBut I agree that you need to give them a reasonable chance.