Unpaid Invoices

[Arctostaphylos uva-ursi]

I have sent statements to clients with interest and late payment fees added but have found that many just pay the initial sum owed and ignore the extra charges.

Has anyone else had this? How have you dealt with it? Any success in recovering the additional charges?

[benedmonds]

I have sent statements to clients with interest and late payment fees added but have found that many just pay the initial sum owed and ignore the extra charges.

Has anyone else had this? How have you dealt with it? Any success in recovering the additional charges?

 

Life is to short to chase the additional charges IMO. Its £70 charges plus the interest which isn't much.... If they didn't want to pay for work you have done then they are really unlikely to want to pay extra charges..

[Arctostaphylos uva-ursi]

Life is to short to chase the additional charges IMO. Its £70 charges plus the interest which isn't much.... If they didn't want to pay for work you have done then they are really unlikely to want to pay extra charges..

It depends on the size of the bill and the length of time it has remained unpaid. I find its the bigger companies that are the worst offenders. Some seem to have systems in place to try and avoid payment and waste your time passing you from pillar to post.

[nailer]

I've got a feeling that if a domestic customer doesn't pay straight away after one reminder then we've messed something up somewhere along the line. Fair- sized companies can need chasing. imo massive companies are best avoided altogether.

[richy_B]

In my opinion you just need to get your t&c's straight from the beginning. On all my quotes I state my payment terms (I stick to 15 days terms) and that an invoice will be send/given on the final day of the works. I then write 'after 15 days a stop will be put on your account and no further products or services will be supplied. After 30 days the invoice will be passed to our debt collection agent. All outstanding invoices passed to our debt collection agent will no longer be dealt with by ourselves'. It might sound a bit heavy and can put people off but I think you need to be absolutely straight with customers from the moment you quote. Those are my payments terms, if you do not accept then you are not obligated to use me. Also if they are the type of customer who will mess me around for payment, I'd rather they didn't use me anyway.

 

Debt collection will cost you about 8% of the invoice for commercial customers and a bit more for domestic and will almost certainly end your business relationship but by that point its most likely screwed anyway.

 

If its your 'main' contract etc you obviously need to tread lightly but its an all too common story that small business go bankrupt because larger firms screw them over payment. Who would you rather upset: your main customer or the staff you can't afford to pay at the end of the month and all of your suppliers?

Edited October 22, 2013 by richy_B