Late paying customers

[Mr Fro]

What do you do about them?

I sold a device to a large company (global) who use an intermediary to do their procurement stuff. I sent them the quotes and invoices like a good boy with a nett 30 day agreement.

I got on to them when they were a couple of days late and they said they'd "lost the invoice" so I re-sent it. A week later - still no payment - I called again and they said the monthly payment window had closed and that the invoice will be settled at the beginning of Dec. Three days in and still no payment.

So here I am 3 or so weeks on, just got notice of redundancy from my "proper" job and needing to get the financials sorted so I can get my little firm up and running full time.

What do you reckon? Softly, softly or stick them with late payment charges and give them aggro? A mild complicating factor is that I'll probably get stuck dealing with this company in the future.

Sorry about the rant. :-)

Cheers,
Fro

 

[skotl]

Sorry to hear about your "proper" job...

Re your topic, my wife is self-employed and did some work for a guy who she used to work for, who is now at a massive company (Akzo Nobel, if you're interested - nowt untrue or libellous in what I'm writing). She sent the invoice to the office in Scotland where said guy worked and they hadn't paid in 60 days.
She wrote to them and they responded with "we pay in 90 days".

Darn, thought wife, but that's what you get with a big company.

Nope - worse than that. 90 days go by and she gets a letter saying "your invoice has been rejected because it must be addressed to our finance operation in the Netherlands - please resubmit to them". And, of course, the 90 days is from receipt of the invoice in the Netherlands. She she waited over six months to get paid.
Why did the Scottish outfit wait 90 days to tell her the invoice needed to go somewhere else?

To answer your question, she wants to get extra business from them so saw no point in aggravating them - it would be water off a duck's back, anyway...

Good luck with your expanding venture, though!

 

[Tom Orrow L]

Depends on if they're giving you repeat business. If the possibility is there & its worth keeping yourself in the good books then try the softly softly

 

[BrokenBiker]

Keep on top of it. Forget softly softly, be firm and request prompt payment. If they still keep flapping then threaten a late payment fee, if they still flap then put the fee on. Repeat business should be based on your work, not the fact that the company thinks they can mug you off when money is owed

 

[Shox Dr]

It's your terms not theirs. Bill them.

I used to sub to a large Cycle/Motor parts store. My terms were 30days, theirs 90 from last day in month. So 120 days.

The first bunch of invoices were late. They were informed they were on stop, and interest been charged. Cq arrived the next day.

This happened every month for the 4-5yrs I supplied to them, unless I put them on stop

Your ball, your rules, enforce them.

 

[colnerov]

Do you really want customers that don't pay? If they don't pay they're not good customers. Could you offer a 'discount' for prompt payment? Just adjust to suit beforehand.

 

[dunk]

i agree with shox dr, no soft ball, bill them for late payment, your not a bank for them, companies like this just mess your cash flow up,

 

[TechnicAl]

Like I said in another thread.........this is one of the problems Self Employment brings

If youre in a strong enough position to play hard ball then all well and good.......many are not and never will be

Ive been told more than once to stop doing business with firms because theyre stroppy

 

[Wendelspanswick]

I agree with Shox, I used to supply a multi national company and they had an overdue invoice, when I chased it they replied that as they were paying the shareholders their dividends it would be delayed by a month.
Two days later a new order came in which I rejected, when the purchasing manager got in contact to find out the reason he went ballistic and said he was going to stick a rocket up the accounts managers backside.
Sure enough the next day a cheque appeared with a grovelling apology.

 

[Shox Dr]

Do you really want customers that don't pay? If they don't pay they're not good customers. Could you offer a 'discount' for prompt payment? Just adjust to suit beforehand.

I used to do mapping literature for a company, it was when I was first starting out. They didn't pay me when asked. So the next invoice I gave them a 5% discount if paid within 30 days.

I get a call from the MD within 30mins of dropping it off. He was going ape, that I should offer such a discount, as he might not see that invoice for a month.

Funny I said 'you saw that one within 30mins of me giving it to the receptionist'

He was less than happy, so after an hour on the phone to him, I said pay the invoice in full, and the next time you use my services I'll give you 10% directly off the bottom line.

They paid late. And I never heard from them again and good riddance too.

 

[roofman]

With every single one of my estimates theres a few attachments that go with it,one is my terms and conditions which at the bottom in bold black it says "payment is due on completion of all works unless prior arrangments have been made"...Another A4 attachment carries the FOA, Form of acceptance which the customer must read and sign then send it back to me before any work is carried out. This keeps my cash flow to a sensible time frame and i can honestly say i have never had anyone refuse to sign the "contract" because of fast payment requirements.

 

[Welderpaul]

Standard excuses.

Grit your teeth and hammer them, and keep hammering them until they pay. In full. They have your money so who cares.

You can guarantee they won't stop using you because you are chasing money.

 

[mike os]

as you have supplied to a company you can legally add interest at a given rate above base, details are available online,,, guess search for late payments and interest or such Gov website IIRC tells you exactly what you must do

My attitude to late payers is I dont need your work or the grief, and if I did and you are not paying I am actually worse off than if I didnt take the work in the first place....

 

[Bill Edwards]

Supermarkets are notorious for doing this. They will string it out for months on end, then pass it along to another department to string it out and so on.
All the time, keeping money in their bank, and it gets them a lot of money.

I suggest you chase them hard, this is not acceptable. Always be polite and friendly, and remember that it is not the fault of the person you are speaking/dealing with so don't allow anything to become personal.

 

[mike os]

https://www.gov.uk/late-commercial-payments-interest-debt-recovery

 

[addjunkie]

If your going full time self employed, as said earlier, make your ts andcs water tight, including how much your interest will be for late payment.

On the ball buyers will reject your ts and ds and request you accept theirs, others wont. If you acept their you have to have the cash flow arrangments in place. Big companies are awful to deal with.

Im employed by a large multi national plc, the amount of times goods and services get stopped for late or non payment is disgracful. When you try to follow up with paper pushers, they just dont seem to give a monkies and seem to have no concept of what the company actually does and we we need the goods or services.

 

[dunk]

when i first started out on my own many many years ago this late paying game cost me plenty due to unpaid invoices, excuses ranged from, cheque is in post, the person that sign`s off the invoice is on holiday, we`ve not received your invoice, there`s a discrepancy with an invoice, no one here to sign cheque, the list went on, taking 60 - 90 days to pay a invoice is plain p taking and plenty of time for the company to cease trading, after this i adopted the view that if a company can not pay a small invoice of say £50 - 100 on time you will get problems of the larger ones coming through on time, so they either paid part up front and rest on completion, or go find another sucker

 

[Appyasme1]

Understand your problem.If they live near to you go and knock on the door,they will hold on to their cash as long as they can.

 

[CompoSimmonite]

If you go to a supermarket etc and fill up the trolley then say "I'll pay you in 90 days" then they wouldn't let you leave the store yet the very same people expect tradesmen to accept those terms !
Glad I was always PAYE as I couldn't cope with the stresses you Self Employed have to suffer.

 

[clift_d]

Just add a little note to the bottom of any future invoices next to your payment due terms saying something along the lines of:

"We reserve the right to charge interest on late payments at 8% above Bank of England Base Rate in accordance with the Late Payment of Commercial Debts (Interest) Act 1998"

I would be quite surprised if that doesn't get their attention. With regard to the current invoice, send them a polite letter reminding them of the date at which your payment terms expired, and advise them that you reserve the right to charge interest from that date on the overdue payment should you not have received full remittance within seven days of the date of your letter.