Late payers

How to handle late paying clients

At some point during your VA career you’re going to get some late payers. I wish I didn’t have to just tell you that, but it’s just the way things are. Some clients are really good payers and some clients are a pain in the rear – it’s the way of the world. There are a few things you can do to mitigate the damage however.

How to deal with late payers

Prevention

Some people are anxious or embarrassed to talk about money but, after a few late payers, I can guarantee you won’t be one of them! Make sure you state in no uncertain terms what the payment terms in your freelancer contract are from the get-go and ensure new clients are clear about what they are.

Put your payment terms on all invoices and make it easy for clients to pay you. Good client relationships involving regular communication mean late payments are far less likely to occur in the first place.

12-step late payer procedure

  1. You have a payment policy and terms to begin with
  2. You email new clients a copy of your T&Cs and Contract and verbally outline your payment terms
  3. You invoice new clients after two weeks (or less) to reduce any impact
  4. You retain open and regular communication with your clients and ensure you’ve both agreed on the timescale and budget of each new project
  5. You know how much time they want you to spend, and they know how much their invoice is going to be
  6. Your payment terms are on each invoice you send out along with clear instructions on how to pay you
  7. You email a friendly reminder a day before the client’s invoice is due
  8. You let the client know their invoice has gone overdue a day after they’ve breached your payment terms
  9. You send your first formal reminder a week after their payment is overdue. Calls are good but you need a paper trail
  10. You send your second formal reminder a week after the first
  11. You send a final demand telling them you’re about to start legal proceedings to recover the payment
  12. You follow through with your threat

My own experience

Steps 1-6 usually work for me, but I once did some market research for a new client who failed to pay me even after I’d chased him a few times. I’d never worked with him before and, looking back, I did get a ‘dodgy’ vibe off him from the start.

He’d wanted me to do some research on local companies so he could target them in the future to potentially do business with them. After only completing around £100 worth of work, I emailed him an invoice but he failed to pay me or return my calls.

Despite many chases (and rather unprofessionally I admit) I left him a voice message saying I would be contacting each person on that research list to tell them he was untrustworthy and not to do business with him.

The money was in my account within the hour.

I also have a client who used to regularly pay me late but I very much like her and the tasks she gives me. We had a discussion and it turns out her Accountant always pays invoices once a month on a specific date – so I just moved her invoice date so my 14-day payment terms fell within her set pay run date.

Sorted.

Taking legal action

If the amount owed to you is very low then you could just suck it up and learn from the experience. However, law firms will send standard payment demand letters for just £10 and it only costs around £30 to go to the Small Claims Court.

Conclusion and resources

You can avoid a lot of hassle simply by setting out from the beginning what your payment terms are and agreeing with your client how much work you’re doing, at what rate, and over what time period before you start work.

Managing your clients and their expectations is a large part of being a Virtual Assistant so deal with late payers professionally, don’t bad mouth them all over the Internet and have procedures in place to avoid it in the first place.

Over to you; have you ever had late a payer and how did you recover your money?

2 Comments

Dawn Williams

He paid within the hour, I just love that. You did right there Jo. He didn’t get a
mediocre VA he got you. The way of this world, some people don’t care and are
very cold and croc skinned and some people care too much to their own detriment!

Reply

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