When The Check Doesn't Come

So, you landed a gig with a new client, shot off your proposal and they bought it. Yippee! The client seems nice enough, but you did have a wee bit of back and forth about the 50% up front stuff. “Ah ... it happens,” you think. Times are tough. You need the work. It’ll be a quick job so you decide to forgo the retainer and jump in. You’re thinking,“I can get this done in just a couple of days. By the time I get the half, it’ll be time to bill the rest, anyway.”

You’re slaving over a hot keyboard making sure everything’s picture perfect. Your client approved everything with only a couple of minor revisions. Now the gig’s out the door and ready for your favorite sport – billing. You fire up your accounting software du jour and whip up an invoice. Net 30. Into the envelope it goes and off on its merry way.

30 days come. 30 days go. No dough. Okay, so you decide to let it ride for a while. Every day you make the short walk to the mailbox and peer inside. Nothing ... except some more bills.

45 days come. 45 days go. Still nothing. So, you send off a very polite email reminder. No response. You’re getting a little antsy. You send off another copy of the invoice with “Past Due” stamped across the page.

60 days. 90 days. Nada. What’s a creative to do?

With good marketing comes work. With work comes billing. All too often, with billing comes your share of late payers and their evil cousin, the non-payer.

Collections is one of those tasks that creatives often shy away from. Many fear confrontation. Some are afraid of losing a client (even if they don’t want to pay). Still others are concerned about getting some negative buzz. But, collect you must, unless you happen to be independently wealthy and highly philanthropic.

There are a few ways to handle your collection activities. You can do it yourself. But, that means losing time you could spend on paying projects. You can turn it over to your attorney or hire one who specializes in collections. Or, you can turn the matter over to a collection agency.

Lawyers can be helpful, but expensive. Plus, if they’re good, they’re busy and it might take a while for them to get to your problem-at-hand. Collection agencies can creep some folks out, but they can be your best bet to get some money for your labors. Sure, there’s a fee, but it’s likely less than what an attorney would charge. Plus, getting some, or most, of your money is better than getting nothing.

Iris Salmins, V.P. Sales and Marketing at EJL and Associates, a firm that specializes in collections for creative services, says, “All collection agencies are not evil, we are helping small business people stay afloat.” She added, “If they are not paying you, they are not your client, they are your dependent.”

“Every contract should include a clause that says that if your clients don’t pay in time, they will have to pay for court costs, attorney’s fees, any other legal fees and collection agency fees,” said Salmins. Good advice.

Iris also shared the following tips when working with a collection agency.

• If someone hasn’t paid you in 60 days it is time to get the account into the hands of a trusted collection agency.

• Never pay anything up front. The agency should be paid only if you get the money from a client whose account you have turned over to them.

• Never sign a contract with an agency that includes an exclusivity clause.

• The agency should be willing to give you the name and phone numbers of three existing clients.

• No amount of money should be too small or large for them to handle for you.

• The management staff of the agency should have a good knowledge of your industry.

When all is said and done, collections is part of doing business. At some point we all have to face this and having a plan is place is a good idea. In the long run (and even the short one) it will help you avoid a load of aggravation and anxiety.