Delayed payments are one of the biggest challenges service providers faces in their day to day. Not only do they delay bookkeeping, but they can also demoralize service providers because no one wants to work without getting paid for it.
But then, there are situations where delayed payments are unavoidable.
If you think about it carefully… I am sure you have had experiences where your most reliable client(s) did not pay in time due to card, bank, or financial institution issues they had little control over.
And while this is fairly commonplace, we both know there are scenarios where you just bagged a client who has forgotten about your balance or worse… remembers and doesn’t want to do the right thing.
Managing Delayed Payments
Today, we will share some vital tips that will help you manage these situations professionally and come out of it without harming your brand’s reputation… or finances.
- Communicate the delay professionally and courteously: Money can be a touchy subject anywhere in the world (especially in business) and no one wants to perform a service without being paid for it. But there are times when your client may have more pressing concerns (like a family emergency, personal challenges, or business challenges) and may not remember your payment. This is where you need to take the lead and send them short and polite reminders like this one…
“Hello XXX, I hope all is well with you? We have wrapped up the {indicate stage of project} and I am glad you are satisfied with it. However, I noticed you have yet to transfer the payment for this stage of the project and I was wondering if it had skipped your mind XXX or if you’re having trouble with your payment platforms. If it is the latter, you can send me your preferred platform and I will provide a walkaround with this. Thanks”.
2. Ensure you have a written agreement before starting the project: Yes, I know this may sound like a lot of stress, but the truth is, a written agreement protects you from situations where a buyer intentionally refuses to make payments. Here, this document can be tendered in a court of law, with the buyer mandated to complete your balance before a given date.
3. Work with a platform that supports Escrow: Workstedi’s Escrow system makes sure the buyer deposits ALL OF THE MONEY REQUIRED FOR THE PROJECT (and the amount would have been agreed upon by both parties) before project commencement. This means they’ll release the money in milestones (approved by both parties) and you get paid for every complete milestone. In the event of a payment delay, you can lodge a complaint with our team and we will investigate promptly, And if you don’t have a Workstedi account yet, you can sign up here.
4. Vet your clients: I know on this side, most people see vetting as one-sided… clients vetting artisans and freelancers. But as an artisan, it is important to “screen” your clients for certain qualities too before agreeing to work with them. If you are not sure where to start with this vetting, Workstedi will help you. Our feedback systems show you the previous reviews of potential clients. This way, you can tell which ones are most likely to delay payments… and if you want to proceed with their projects or not.
