How to deal with a customer that doesn’t pay
If you own your own business or are self-employed you are at some point going to come across a customer who does not pay or is late in paying. In my experience this is not as simple to deal with as you might think.
It can raise many questions:
How long do I leave it before I contact them to ask for payment?
Do I send an e-mail or pick up the telephone?
Do I do more work for a customer who does not pay?
If I demand my money will they bad mouth me?
Then the upsetting thought, maybe I didn’t do a good enough job therefore they haven’t paid? This can be an easy pattern to fall into within the first years of business.
So how do we deal with this?
There are obviously some legal issues involved in getting payment from a customer if you have done an agreed job or provided a product. However, this is a last resort and takes time money and energy
Check out the government website for more help: https://www.gov.uk/invoicing-and-taking-payment-from-customers/payment-obligations.
So how do we avoid getting into this position in the first place.
Whenever this issue arises the first question I ask is have you asked for the money? Often the answer is no or they have sent an e-mail reminder that hasn’t been replied to. It is not uncommon when new in business to go down the rabbit hole of there must be something wrong if I have not been paid, 90 % of the time your invoice has been forgotten or put to one side and got lost. By picking up the phone you will jog the person’s memory and be paid.
Do you have good terms and conditions and boundaries around payment for your product or service? Don’t be afraid to put in tight boundaries around being payed, this might mean asking for payment up front or payment on receipt of goods or services. Giving a customer clarity and reassurance about your business boundaries should reflect through the whole of your business making the customer feel safe, it shows your ability to be organised and confident in what you do.
It is not uncommon for someone new to business to take a non-payer as a personal affront about themselves I certainly did this in the early days of my business life. If a person consciously chooses to not pay for an agreed service or product is not a reflection of you it is their own moral compass that has a problem.
However, when these situations arise as they inveterately will they are sent to show us how to improve next time how to strengthen our business and personal boundaries around the flow of money.
As I constantly say business is a learnt skill we are not born with the knowledge of how to run a business so be easy on yourself and ask what can I learn from this experience.
I hope reading this blog has inspired and helped you with your business in some way.
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