We all know how it is supposed to happen. You send in your invoice and, within a specified time, your client pays. Easy! If only it was always like that. So just on the off chance you've had a different experience occasionally, here are a few thoughts.
First let's consider delayed payment. I don’t know of anyone in the consulting business—or in any business—who this hasn’t happened to: The invoice is due, you’re waiting for the money to drop into your account or a check to arrive in the mail. And you wait and you wait. Nothing happens, so finally you follow up with your client contact (which in my experience is much better than contacting your client's accounts department). Typically you’ll face one of four scenarios:
I experienced this and found out the company was suffering cash-flow problems. If you have the feeling that this might be the case, when you go into the next project, my advice is to demand your fees up front.
Someone refusing to pay is hopefully a situation you face very rarely, if ever. Delaying a payment is one thing; flat-out refusing to pay is another. If your client is uttering those words, things have gone badly wrong and should never have reached that stage.
Once this happened to me. I set up and signed a contract with a medium-sized consulting company. The CEO of the company also signed it. Basically it consisted of a finder’s fee percentage for work I brought to the company plus a deal on projects that I worked on with the company. All was fine until I found them a $50,000 project and claimed my finder’s fee. At that point, the CEO refused to pay, saying that he should never have agreed to the fee. I pointed to our agreement, and he still refused. And so on and so on. Eight months later, I got the money out of him after pursuing legal action. I’ve never worked with him or his company since, and I never did find out what the problem was.
So if you’re unlucky, this can happen.
If a client just simply refuses to pay and won’t compromise, listen to reason, or respond to your multiple payment demands, you have two (unpleasant) options:
Finally, if a client chooses not to pay you, I suggest never ever working with them again. Not even if you eventually get your money.
Getting paid is critical to us all. I'd love to hear your comments.
As a highly experienced energy and sustainability consultant, engineer, speaker and author of “Consulting Made Easy” and "Writing Proposals That Sell!". Adrian assists consultants, or would be consultants, to achieve success on their terms in their own consulting businesses. He is the creator and presenter of the Consulting Expertise Masterclass webinar series and the Consulting Strategy Blueprint.
Contact Adrian at firstname.lastname@example.org to learn more or to set up a complimentary Business Scoping consultation to help you transform (or start) your business.
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