{"id":3416,"date":"2012-03-17T11:20:13","date_gmt":"2012-03-17T15:20:13","guid":{"rendered":"http:\/\/blog.fitnyc.edu\/hottopicsinsider\/?p=3416"},"modified":"2020-01-21T18:52:26","modified_gmt":"2020-01-21T22:52:26","slug":"strategies-for-dealing-with-deadbeat-clients","status":"publish","type":"post","link":"https:\/\/blog.fitnyc.edu\/hottopicsinsider\/2012\/03\/17\/strategies-for-dealing-with-deadbeat-clients\/","title":{"rendered":"Strategies for Dealing with Deadbeat Clients"},"content":{"rendered":"

There\u2019s a basic accounting and food retailer phrase called FIFO \u2013 first in \/ first out. Simple enough. The point of the phrase is to move the merchandise fast so it doesn\u2019t spoil or lose value.<\/strong><\/p>\n

So how does this apply to a client that doesn\u2019t pay their bill?<\/strong><\/p>\n

In general, the longer you keep a client like that in play, like trying to get your payment, the slower the rest of your business goes. That\u2019s because you\u2019re not focused on the present and future, but on the past and trying to recoup monies, save face, vent anger, and not feel victimized \u2013 or any combination of the above.<\/p>\n

By doing the best you can as fast as you can to collect payment, you can move on quickly.<\/p>\n

Here\u2019s a couple of strategies:<\/strong><\/p>\n

A client tells you you\u2019re incompetent and that\u2019s why they\u2019re not paying the bill. They know full well you\u2019re not, it\u2019s just an excuse.<\/p>\n

Or they pay only part of a long overdue retainer and not the rest, promising to pay but you know they won\u2019t.<\/p>\n

Strategy #1:<\/strong><\/p>\n

Tell them you can\u2019t make them pay the bill but you can guarantee there will be consequences if they don\u2019t. One consequence is sending a notice that you are going to sue them. Usually when they see this notice, they pay up. If they don\u2019t, then you can actually file the notice and sue (or arbitrate \u2013 but only if it\u2019s worth the money, time and effort to make you whole).<\/p>\n

Strategy #2:<\/strong><\/p>\n

Tell them they have until (set a deadline) to pay or you will sue. Or not release their work. Or not complete the assignment you\u2019re currently working on. If they don\u2019t pay by that date, stop work, and fire them. Let them come after you to get back their art work or anything else they own.<\/p>\n

Some preventative strategies:<\/strong><\/p>\n

\u2022 Get a purchase order (theirs not yours)
\n\u2022 Don\u2019t start work until you have a written contract
\n\u2022 Set payment terms upfront and try to a large percentage upfront: 50%-50%, 60%-40%, etc. (sometimes clients try to skip out on the last bill altogether)<\/p>\n

Turn and run fast in the opposite direction when you hear or see:<\/strong><\/p>\n

\u2022 \u201cThere\u2019s a lot more work down the road if this works out\u201d or an alternate — \u201cgive it to us for free this time and there\u2019s more work down the road\u201d.<\/p>\n

\u2022 \u201cLet\u2019s not get the lawyers involved.\u201d<\/p>\n

\u2022 A big neon sign across the potential client\u2019s forehead that reads \u201cA**hole\u201d \u2013 trust your gut.<\/p>\n

 <\/p>\n

Sandra Holtzman teaches CEO 035: Licensing<\/a>.<\/em><\/strong>
\nShe is the author of Lies Startups Tell Themselves to Avoid Marketing<\/a>.<\/em><\/strong><\/em><\/strong><\/p>\n

 <\/p>\n","protected":false},"excerpt":{"rendered":"

There\u2019s a basic accounting and food retailer phrase called FIFO \u2013 first in \/ first out. Simple enough. The point of the phrase is to move the merchandise fast so it doesn\u2019t spoil or lose value. So how does this apply to a client that […]<\/p>\n","protected":false},"author":266,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"post-templates\/post-middle-column.php","format":"standard","meta":{"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":false,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2}},"categories":[8577],"tags":[8582,8624,8576,8581,38568],"class_list":["post-3416","post","type-post","status-publish","format-standard","hentry","category-small-business","tag-business-tips","tag-entrepreneur","tag-entrepreneurs","tag-global-business","tag-small-business"],"jetpack_publicize_connections":[],"jetpack_featured_media_url":"","jetpack_sharing_enabled":true,"jetpack_shortlink":"https:\/\/wp.me\/p1v7EM-T6","_links":{"self":[{"href":"https:\/\/blog.fitnyc.edu\/hottopicsinsider\/wp-json\/wp\/v2\/posts\/3416","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/blog.fitnyc.edu\/hottopicsinsider\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/blog.fitnyc.edu\/hottopicsinsider\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/blog.fitnyc.edu\/hottopicsinsider\/wp-json\/wp\/v2\/users\/266"}],"replies":[{"embeddable":true,"href":"https:\/\/blog.fitnyc.edu\/hottopicsinsider\/wp-json\/wp\/v2\/comments?post=3416"}],"version-history":[{"count":0,"href":"https:\/\/blog.fitnyc.edu\/hottopicsinsider\/wp-json\/wp\/v2\/posts\/3416\/revisions"}],"wp:attachment":[{"href":"https:\/\/blog.fitnyc.edu\/hottopicsinsider\/wp-json\/wp\/v2\/media?parent=3416"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/blog.fitnyc.edu\/hottopicsinsider\/wp-json\/wp\/v2\/categories?post=3416"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/blog.fitnyc.edu\/hottopicsinsider\/wp-json\/wp\/v2\/tags?post=3416"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}