Client Payment System
Today’s question comes from Esther, who has a client who won’t pay their invoice.
This had to happen to me one time about 15 years ago when I got stiffed for a bill that was over $400. I went to my dad, who I called my business manager then, and I was like, “Daddy, like I’m so angry. What do I do about this?” He explained to me that when people have a need that needs to be met, they’re more than happy to pay for that need to be met. As soon as the need is met, their motivation to pay you drastically decreases.
Start collecting payment upfront.
So he suggested collecting payment upfront, and I thought then that I can’t do that. My clients won’t put up with that. They’re going to all fire me. And all the stories I told myself about what would happen, but I finally did it.
I may had pushback from two customers. This was 15 years ago, and it is one of the best things I’ve ever done for my business.
Start collecting payment upfront.
So now, we collect payment four days before the start of service. We keep our clients’ credit cards on file. We charge the card four days ahead of time, and then it’s done. We don’t have to worry about it—no more chasing client payments. And if you have your new client onboarding system well thought out and well organized and explain it to your customers, this is how we do business around here; you will not get pushback.
And some people will say, “Oh, I don’t want to pay upfront.”
“Okay, well then, I’m not the service for you.” It’s as simple as that. There are more than enough clients out there for you, and you don’t have to worry about losing clients because they want to avoid following your procedure.
Email an invoice. Then send your Venmo QR code or the link to your PayPal.
You might be saying, “Well, Colleen, I don’t have a system where I can keep credit cards on file. I’m a smaller business.” In that case, email them an invoice and send them your Venmo QR code or the link to your PayPal. It doesn’t have to be difficult. There are many ways to collect payment nowadays, but ensure you do it beforehand.
And for those clients that haven’t paid, I suggest sending them a letter via certified mail with all of your invoices attached, letting them know if you have not received payment in X amount of days or by X date, you will be turning them in over to collections and then go ahead and turn them over to collections.
There’s no reason these people should not have to pay their bill to you, but you won’t have to deal with that if you collect payment beforehand. You will thank me, I promise.
