Collections

[Eric_E]

For you business owners, what do you do to minimize collection hassles? What collection methods do you use? How many have had to use legal means to collect and what were the results? For those with written contracts what were the results?

Yes, I am preparing for what appears to be my second legal collection attempt. It was sooo much easier when I was a wild youth, just shoot their cat and water balloons full of Triox in the front landscape. Doesn’t help to get paid but does relieve the pent up tensions.

 

[Nathan]

I try to be proactive. I rarely have written contracts. Having an amiable personality and sales method, this has worked.........most of the time.

Generally, I discuss order of operations with them, walking them though all of the work to be done, the order in which it will be done, time it will take, then tell them that I will expect payment at that time when the work is completed. I usually email an invoice before I even show up.

Other than that, just saying, " I spoke with my lawyer and he said I should not bother you for payment anymore and just place a lien on your property ASAP. That way, I may not get my money this year or even in ten years, but I WILL get my money." It worked.

I had another who terminally had the check in the mail and just showed up at 9:30 one night and asked firmly for payment. They found the check book.

In hind sight though, I should have read the client better before the sale. I am much better at it now but it is only from experience.

I would say tell them you are placing a lien on their property and be willing to follow through - most people can smell a bluff a mile away.

 

[BLUE_FIN]

all jobs performed should have a written agreement with a signature of authorization by the client and the services should be performed exactly as stated in the written agreement so if there is a problem down the line you are covered and also most insurers require that you do that. in this day and age anyone who operates without written approval is leaving themselves open for problems. all my contracts state everything from the costs to the procedures down to the clean up to even down to how and when i expect my payment . all of my contracts have most of the details printed on them on the front and back of the contract so all i need to do is add the specific details of that job to be performed and i am all set it only takes five minutes and my butt is covered because it takes all kinds to make the world go around and the more people you deal with the more your chances increase of running into a dead beat customer. and with no offense to the previous poster you will need a little more than a charming personality and witty conversational skills to get your money out of a client in the court of law . plus i am not to sure on the laws in your state but in my state you need to have a written agreement and sighned agreement before you can slap a lean on someones property plus if you have all the above you can send it to a collection agency to do your dirty work and they cost a hell of a less then a liar ooops i mean a lawyer .

 

[Nathan]

I will not even attempt to argue with CYA. Good point.

I can honestly say that "the more people you deal with the more your chances increase of running into a dead beat customer" isn't true. I can smell them now. Not everyone is my customer nor do I want them.

Nothing like a contract to CYA for those with a cover scent but unfortunately if your contract wasn't drawn up by a lawyer, it probably isn't worth the paper it is printed on. Best bet is to have a feel for the potential client.

Plus, if it ever comes down to Perry Mason time, the only people that will make money are your lawyer and theirs. Even if they had to pay legal costs, they would not reimburse you for your time and stress.

 

[BLUE_FIN]

i will agree that after a while you can smell these people out but every so often one slips by . but i can tell you this between our spray clients and new customers we deal with over 5,600 different people each year and thats a decent amount of people and invoices and about 3,500 of these people we deliver multiple services to and in the end thats a lot of checks and when you deal with that many people you have a occasional check bounce you get some complainers some even lose thier jobs after they gave the go ahead and then realize they do not have the money but what i am getting at is some people will not admit they do not have the money so they try to blame something you did to get out of paying the bill and that is why i stress to all people providing written estimates to have the customer sign the proposal because following through on these policys and getting that john handcock on the dotted line has gotten me my money every time and in 19 years of this business i have never not gotten paid with the exception of one time when i did a estimate for a very old woman that was all alone and when i gave her the estimate it was in the early spring and i was swamped with work and i told her that it would be at least a month until i would do the job and she was in no hurry and said come and do the job whenever i wanted and i did not even have to call ahead . so it came time to do the job and i called and got a answering machine i left a message and said i was coming to do the tree tomorrow and if there was a problem with that to call and if i did not hear back that i would assume it was ok . well we came and did the job and there was not anybody home so i mailed the invoice and many weeks went by and i called and called i sent more bills i even periodically knocked on the door . well after about 2 months i found out the lady had passed away shortly after i gave her the proposal so after that i never pursued getting the money because i did not have the balls to bother her family for the money i felt it was not that big of a deal to go through that for 700 bucks. so after that i now even include a call ahead before i come and i will not come and do the job until i have verbal contact with the customer . i do make exceptions for all our steady long term clients .

 

[BLUE_FIN]

one other thing i would like to add is i never had the privlige to visit the lone star state and one day before i die i would love to . but i believe your state and a couple of other neihboring states share a place called tornado alley well up here in new jersey we have a alley of our own its called law suit alley and maybe its a little better down by you at least i would like to think that in hope of not every place is like the money hungry north east but that is why i have the approach that i do cause you can never be too careful. you see its no differant then putting a hard hat on while your on the job its all about saftey . because saftey is not only protecting your health and well being and the people around you its also safeguarding your business because in business CYA is just as important to the saftey of your business as is a hard hat is to the saftey of protecting your head.