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getting paid

edited March 2003 in Q and A
Has anyone got any clever methods of getting cash out of clients? After about 2000. ANd if you can't, is a debt collection agency the only place to go? I don't think they'd be interested in sucha small amount. Would be such a good job without clients..


  • edited January 1970
    Might not work but I once managed to get paid by printing several large demands for payment, taping them end to end in a loop and then faxing the never-ending loop to them. Even if you don't get paid you will have the satisfaction of putting their fax machine out of action and using up all their fax paper for as long as you choose. Good luck!
  • edited January 1970
    I went to a seminar recently where they suggested taking a deposit from clients up front. Only about $200 or $300. This is supposed to quickly weed the serious clients from the ones looking for a few free ideas. Haven't quite got around to trying this yet, but I may do so.

  • edited January 1970
    son, may I suggest writing a kind letter inviting the dear client for a cup of tea; there will be ample time to discuss the payment during tea. I might add, that what has often happened to me is that the cheque is presented along with the of course it was merely an over sight in the first place. best wishes and good luck!
  • edited January 1970
    I created a ficticious Debt Recovery Company and drew up a ficticious demand document. (I used a real one as a guide. I'm sure you would have one too.) It isn't that demanding, but it does draw their attention that any unpaid debts will default against their Company's credit rating. It asks to forward unpaid amounts directly to our office or into our bank account, with the usual "legal action will be taken within seven days" content as well.

    It works with regular results. At the very least, the Client will call to discuss their invoice. Sometimes settling for a percentage is better than nothing at all.

    Good luck.
  • edited January 1970
    Thanks everyone for the responses to my post. It seems an ever present problem, cash extraction. For that job I managed to elicit about 25% out of him, was grumpy about it for exactly 11 months, and then thought life's too short to get miserable about losers. I gave up at 25% because it was taking so much time to chase him, time that could otherwise be spent earning money. But I may still try that fax roll technique as a parting shot.

    I was also thinking that I might changing my bill to look threatening and corporate like a Telstra bill, with the "$5.50 late charge" prominently displayed...
  • edited January 1970
    ive worked with a company called Baycorp before and found them very good and recovering amounts as small as $1000 - they charge 10%

    give them a try

  • edited January 1970
    I like the fax loop idea, but it won't work on my multi function device...

    Sometimes when I get a client to pay up some cash owing, its in a shady corner and they pull out cash and assume discounts, and no GST. I act school marm and say that wouldn't be right, but it can be tempting. After all, if I put great effort into extracting a partial payment out of someone, why should the tax office walk away with the usual %, without any debt-collecting effort on their part?
  • edited January 1970
    here's the best best bit...
    the "short form" client/architect agreement has no provision for you to stop working on the project should it become apparent that the client has no intention of paying.. yet alone paying on time...... leaving the client with an avenue to seek damages/ costs/ revenge.....or blood.

    this issue is only dealt with in the "long form" client architect agreement agreement which has a clause about suspension of services on basis on non-payment
  • edited January 1970
    Try only working with reliable clients. ie - established developers with a strong track record and financial skills. Avoid "wealthy private investors" and people lloking to make a splash in development after "succesful" careers in other fields.

    Establish strong relationships, provide excellent service, be user-friendly and cost effective.

    Be mindful of the very real impact architectural work (or laziness) has on the profitability of a project.

    Try that.
  • edited January 1970
    Be a bit more specific with your contracts! The more you outline the owners (and your) responsibilities, the more professional they observe you, and your legally binding contract
  • edited January 1970
    This problem rears its head again. Has anyone in Victoria tried using VCAT to recover fees? Sounds like a better alternative to debt collectors, though it might take longer.
  • mermer
    edited 4:09AM
    keep developing your fee proposals/contracts over time to include responses to issues that have arisen. We have done this with the assistance of the RAIA legal services in Brisbane to fine tune wording of agreements. We have taken advantage of Risk management seminars offered and they can be quite insightful. We have a copyright clause included and have reminded the odd client of it when payment is proving difficult. Its all in the contract so have a tight one. The fax loop is a clever last resort....
  • edited 4:09AM
    Peter mentioned a deposit clause. I have been recommended to ask for at least 25% of the estimated total final fee upfront at the contract signing. This eventuation is of course clearly outlined at the first client contact. When the design and muddling through amendments with consultants is settled and the working drawings are complete AND client approved, then a further 50% is required before those plans are submitted for legal approvals. That way the final months of the build and certificate issueings are fraught only with the issue of 25% (plus or minus unforseens) of your total invoice to worry about. As you mentioned Peter, a deposit should weed out the tyre kickers, but why settle on a deposit that would cost the client no more than if his front left tyre got a puncture?
    A serious client should pay a serious deposit and sign a serious contract.
  • edited 4:09AM
    When we had Paul Keatings recession that we had to have I had a client who owed us $3k. Our receptionist at the time was an ex bikie girl and she arranged for some of her acquaintances to park outside his shop in a regional town for the best part of a week. Didnt do his business anygood and we got our money. Desperate times desperate measures
  • edited 4:09AM
    So Philip, how do you ensure contract settlement these days?
  • edited 4:09AM
    Are this bikie girl's acquaintances still available for hire?
    I forgot that I was going to try taking deposits, (that post was 5 years ago...), must try it soon.
    I have another tactic for continual late payers, when renegotiating fees, I sometimes have been known to slap on 3 months interest at the outset. That way I don't get quite as frustrated when the invoice doesn't get paid on time.
    I do find that clients treat my 14 day terms as a guide, if they look at it at all. So I have been thinking of refashioning the invoice to resemble a telstra bill, which seems to more effectively get people to pay on time. Big and bold.
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