I am a graphic designer, and until recently, I didn%26#039;t require my clients to give me a deposit for work. lately, I have a few clients that wait months to pay, and then they don%26#039;t pay the invoice in full. I have since revised my fees and require a deposit, but in the meantime, I am debating whether to inform my existing clinets of my new policies and let the chips fall where they may, or just dropping them because I know that they won%26#039;t change their ways. They are not big clients, I am not making alot of money off of them and they are bad payers. What would be the best way to handle this situation?|||By all means, send ALL clients a letter informing them of your new policies. They will then decide if they wish to remain a client of yours in good standing or not. To not inform them raises the appearance of having a stated payment policy, but only requiring some of your clients to follow it. This could give new clients a reason to challenge your policies. If the slackers leave because of the new policy, no big loss. You will have handled it in a professional manner.|||I own an advertising agency. Clients who are serious business people and reliable payers will not hesitate to pay a deposit. They understand what business is all about and respect your time and skills. Each time a client/potential client asks for work simply say %26quot; I will get an estimate over to you by tomorrow morning. if you have any questions, please call%26quot; Do the estimate making certain you have a provision for revision charges and then do a separate line
that says %26quot;50% deposit required to commence work. Balance due upon completion. All work is the property of the client when paid in full%26quot;.%26quot; Under that put a signature line with the date for them to sign. Do not begin work without a signed estimate or the deposit. A day after you have faxed the estimate if you haven%26#039;t heard from them, simply call and say %26quot;have you received the estimate? do you have any questions?%26quot; if they question the deposit, do not be apologetic, just be business-like. If they argue about it, say %26quot;I%26#039;d love to work with you, your project sounds exciting but without a deposit I am probably not the right designer for you. I wish you the best and if I can help in any way, please don%26#039;t hesitate to call.%26quot; As one of the most brilliant graphic designers I ever knew said %26quot;the only thing I give for free is a price%26quot;. Amen.
PS - do not change your policy for proven clients who have always paid in a timely and professional way.|||Congratulations one sign of a growing business is collection problems.
Let your competition have them. Do not send a letter to all your clients because of a few bad apples. If some clients earned better treatment, give them what they have earned. You get what you reward.
Assuming they still have outstanding balances:
Send a 10 day demand letter for outstanding balance. Send with a promise to send to a collection agency if not paid in full and be specific about the ten days.
Many times a Commercial collection agency will help with a 10 day demand letter for free. This way should they pay after the ten days there is no doubt that the collection agency earned their fee and should it be collected within the 10 days you are not paying for your own efforts.
I would not recommend an agency that just sends letters and has you pay for a letter series. Contingency fees are standard practice with a good commercial agency. Your fees will be based on variables like: the age of the outstanding account, is the debtor company still in business etc.
In this manner you only pay if they collect and the agency is spending its money on letters, labor and phone calls.
The sooner these customers are doing business with your competition the better. Take the position that you do not get headaches; you give them! Give them to the unworthy customer and to your competition. You will think highly of yourself and earn the respect of others.|||I have the same problem time to time with clients, the best way is to present your new policie and give them a chance to shot them selves in the foot. That way they can never say it wasnt about business.
