Small business owners sometimes make some common mistakes when just starting out, and trying to get paid. Some small business owners depend on that income more than someone who gets a check each week. This is because when you work for yourself, the work and therefore the payments are sporadic.
Small business owners just starting out are sometimes so eager to make a sale, that they will accept work or an order without getting a signed contract or checking credit references. They just wait and wait to be paid because they don’t want to offend
the customer or appear that they NEED the money. This happens more often than not.
ALWAYS have a written contract or agreement, you may also want to get half of the money up front with terms regarding the balance very specifically addressed in your agreement. If you can get the other party to sign the agreement, that is even better.
It is worth it to try and collect the money due at first. Make a couple of calls, if promises are made but no payment, think about using a collection service. It shows you are serious and don’t work for free. Word will get around that you mean business.
Your customers will know you are serious if:
• They had to fill out a Credit Application
• They had to sign a contract
• They receive invoices right away
• You send your invoices right away, as soon as items have shipped or the work is complete
• You call right away if you don’t receive payment. Don’t wait!
• You gather all the information you can about the debtor
• You are professional at all times
• You are persistent
• You make personal visits when you can
• You offer different payment methods
• You charge a late fee and/or finance charge
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