Have you ever had trouble getting clients to pay invoices?
Have you ever felt anxious, fearful, or “weird” about billing a client for your time?
Have you ever had to haggle with a client over an invoice?
If so, this is the post for you. (Trust me, you’re not the only one.)
Invoicing projects and getting paid starts out with good communication between you and your client. Don’t be shy about your pricing – but don’t be afraid to negotiate, and let your clients know up front what their work is going to cost. (Don’t you hate getting a “surprise” bill? So do your clients.)
- Ask for a budget up front. Sometimes you get lucky, but most clients are going to tell you they have no idea and little money. This plants the seed that they should think about it and reinforces that you are a serious designer who is going to charge them. (You’d be surprised how many people try to get something for nothing.)
- Don’t be afraid of talking about money. If the roles were reversed, they’d have no problem charging you for their products/services.
- Stipulate that work begins when their deposit clears the bank. This is a real motivator for them to get your deposit in quickly.
- For a continuous client, discuss a price at which you’ll notify them if a project is going to meet or exceed their price point.
Example: If any project is going to cost more than $300, you’ll give a heads up before you begin or as soon as you know you’re approaching that price point.
Create a professional invoice
I know it’s a lot easier to send an email asking for money, but it’s terribly unprofessional not to provide an invoice. Whether you fashion one in InDesign or invoice using your accounting software, you absolutely must send an invoice.
- Use professional payment due terms like “Net 10” or “Net 15.” (This means that they have 10 or 15 days, respectively, to pay the invoice.)
- Provide ways to pay on your invoice or links in the accompanying email (PayPal info, address for a check, Square, etc.) to minimize the “work” your client has to do to pay you.
Send a reminder
If your due date comes and goes without payment, send a reminder promptly – the next business day.
I recommend simply sending a second invoice or, if your accounting software allows, a reminder. Often times they mean to pay and simply didn’t realize the day.
If your client doesn’t respond within the next two-three business days, call them. Find out what’s going on as soon as possible – maybe the owner is out of town until Friday and he’s the only one who can sign checks.
Remember, the longer you wait, the harder it gets to secure payment.
Handling clients who can’t pay
We’ve all been there, and it’s no fun. This is one of many reasons why we always get deposits up front…because partial payment is better than no payment.
If your client can’t afford your bill, discuss options with them.
- Suggest a payment plan over a series of months until their bill is paid off (don’t forget to write up a contract!).
- Negotiate a trade in goods or services – at least it’s something.
- Depending on the size of the bill, you may threaten legal action.
Personally, I’ve never found late fees to work. If a client can’t pay, they certainly can’t pay more, so adding to the bill makes it even less likely that they’ll believe they can ever pay it off.
Finally, terminate your working relationship with them or refuse to do further work without 75% – 100% payment up front until they’ve paid reliably for a full year.
Save all correspondence
Save everything – all of your emails, a journal of when you tried to contact them (and how), what was said, and exactly where the project stands.
This covers you in the event that you do have to take legal action, and it shows due diligence in collecting payment.
What tips can you share?
Have any secrets to share on invoicing and actually getting paid? Share them in the comments on this post!