It’s the freelance circle of life – you pitch the
job, you get the job, you do the job, you bill the job, and you get paid for
the job. Right? If only it worked that easily. When any one piece of the circle
comes apart, everything after it suffers. But when the last part of the circle,
getting paid, comes apart, the rest of your life suffers.
So how do you collect from a slow-paying client?
According to a January 22, 2009 article in the Wall Street Journal, some
companies are using a sweet-talk approach, which ranges from personal phone
calls to gift baskets. When things get really bad, some companies turn to a
strong-arm approach. But hiring a collection company or an attorney can
backfire by alienating them and destroying the relationship.
According to the WSJ article, you can increase
your chances of being paid by taking several relatively easy steps:
- Develop multiple contacts within your client’s
organization, and build good relationships with those contacts, so you have
more people to approach when a payment becomes late.
- Expand clients’ payment options, such as
accepting credit cards, which may be more convenient.
- Email invoices instead of mailing them, so they
- Follow up within a day or two of payment
Slow payment can hit small businesses hard. That
goes particularly for freelance businesses, for which there is a direct link
between money in the bank and food on the table. But what can you do when
collection goes from bad to worse?
Lots of people on freelance list serves say they’d
love to call their clients out on the carpet in some public way to shame them
into paying up, and there’s quite an active ethical and legal debate swirling
around this subject. According to a December 15, 2008 article in The Star
Ledger, one person has done just that. He started a website called “The
Deadbeat List.” Posting a deadbeat client on the website costs $9.99, which
includes a postcard that is sent to the deadbeat client informing them that
they’ve been listed and directing them to visit the website to find out why.
Federal law protects the owner of the interactive
website from being responsible for the information that is posted by others,
but the poster is not similarly protected. Government officials recommend other
options for vetting such complains, such as filing a complaint under the
Consumer Fraud Act with your state Division of Consumer Affairs. Forms are
usually available online, and some states, including New Jersey, offers
Alternative Dispute Resolution to help avoid going to court.
Depending upon how much money you are owed, filing
a claim in Small Claims Court is also an option, but be aware of money limits.
In New Jersey, you can only file in Small Claims Court for up to $3,000. Cases
up to $15,000 must be filed in the Special Civil Part, and amounts larger than
$15,000 must be filed in the Law Division of the Superior Court.
In The Accidental Medical Writer’s opinion, the
best defense against slow-paying clients begins with a good offense. Start by
developing a solid relationship with your client built on mutual trust,
respect, and understanding. Send progress invoices for larger projects to limit
your financial exposure. Invoice promptly, and follow up quickly if payment
becomes overdue. Avoid the temptation to drag your clients through the mud. It
may feel good at the time, but vengeance is a bitter pill. Besides, it’s even
less likely to get you paid. Quite often, slow payment is the result of an
unintentional loss of paperwork, and your client will be happy to expedite the
process to keep your relationship on track.
Co-Author of The Accidental Medical Writer
The Accidental Medical Writer is for everyone who is
frustrated with working for someone else. For everyone who wants the freedom
and security that freelance medical writing can help them achieve. Visit our
website at the link above for information, inspiration, strategies, lessons,
and tips to help you become a successful freelance medical writer, too.
Wall Street Journal article:http://online.wsj.com/article/SB123258195829104305.html
The Star Ledger article: