by Hope
Pardon my french, but once again, a client screwed me. And it pisses me off. Again, sorry for the language.
Most of my work over the last couple of years has been done via online marketplace sites like Upwork and Guru. Working through those sites protects me and the clients. It makes sure they get what they requested and I am guaranteed payment (they record my screen, etc.) I have to pay them a percentage of my fees (10-20% even.)
But I’ve recently taken on several clients referred by others…and via LinkedIn recruitment. It’s my own fault for accepting the clients, but in the end, there are no protections for me.
After over 2 months and incremental payments for project work, a client has ghosted on their final payment, several thousand dollars. Money I was counting on to end the year strong…money I had plans for. And I’m so mad!
Getting Screwed Over is Not New
As a small business owner, this is not new, in my now 13 years in business, this has happened before…but I really thought I was past it. I thought I had enough safeguards in place. (This is a great article on things to do to improve your payment process.) I was trusting my gut and doing incremental billing and building commitments and relationships slowly.
Crap!!!
I billed him on the 25th, confirmed his receipt of invoice. I sent him a reminder on the 30th that payment was due on the 1st.
I continued work, responding to work requests and such on the 1st…but no payment arrived. I sent him a text. (I did this with the last payment too and he responded to say he had put it in the mail late. Ok, I can deal with that.)
Nothing on the 1st, Nothing on the 2nd and Nothing today…
Went to log on to work tools, locked out…
So mad! So hurt!
There is something wrong with people that do this. Take advantage of people like this.
That is all. I don’t feel like I have any recourse at this point…even though I have emails with his commitment, etc. Following up and going after him to pay, well, is it really worth the money and headache?
Of course, the men in my family, dad, brother and boyfriend want to know if I have his address. Ugh. I just can’t.
But not paying a small business owner, a solopreneur like me, really hurts. It affects our families, our businesses and worst of all our confidence and willingness to work for others. So when a small business asks you to pay up front…this is why.
Steps off my soap box, shaking with anger.
Hope is a creative, solutions-focused business manager helping clients grow their business and work more efficiently by leveraging expertise in project management, digital marketing, & tech solutions. She’s recently become an empty nester as her 5 foster/adoptive kids have spread their wings. She lives with her 5 dogs in a small town in NE Georgia and prefers the mountains to the beaches any day. She struggles with the travel bug and is doing her best to help each of her kids as their finish schooling and become independent (but it’s hard!) She has run her own consulting company for almost twenty years! Hope began sharing her journey with the BAD community in the Spring of 2015 and feels like she has finally in a place to really focus on making wise financial decisions.
I’m sorry this is happening to you, Hope. My husband is a small business owner, and this happens to him from time to time as well. You have to assume it will happen once in a while and accept it as part of the cost of doing business. It sounds like it is fairly rare for you, so that’s a good thing.
This is precisely why a cash emergency fund and few debts are so important if you’re self-employed. Remember this feeling the next time you are tempted to take on a new debt.
Hang in there!
Wanted to add… more often than not payment is late, not completely unpaid. Give it a bit of time. If payment is only a few days late, that is not unusual at all.
Document your invoices and formal requests for payment, and absolutely consider small claims court if it comes to that. But also understand that these things happen and it is best to be prepared for late or unpaid work on occasion. It happens to all businesses.
Could you go through small claims court since you said it was quite a few dollars?
If you have the address, mail a paper invoice. I wouldn’t give up on collection without a few more attempts.
Several thousand dollars sounds worth going after.
I would definitely persue this further. The man stole several thousand dollars from you. That is NOT ok. Send a registered letter with the invoice and tell him you will take it to court if he does not pay. Look up the legal process for collecting in your state and his. Look at small claims court. Check BBB. Can you leave a comment or review on linked in? I agree that spending thousands on a lawyer is not worth it. But you can still attempt to collect. Do not make it easy for him to walk away!
Hope, I am sorry this happened to you. It helps me understand why when I have things done at my home, the contractor doesn’t start until I pay for the materials. Perhaps for larger jobs like the one you just completed, you could ask for 50 percent of the bill before you begin the project. Then you would at least have something.
Maybe that is not common in the kind of work that you do. This of course would only apply to referrals and clients you do not obtain from the marketplace websites. Just a thought.
If you have documentation, I would pursue payment for the work you did.
I would take a deep breath and relax. Payment was due Nov 1, it is now the 5th. No excuses for being late, but give humanity a chance.
Written invoice is good, and I would prepare for small claims court for a few thousand dollars.
Wanted to add… more often than not payment is late, not completely unpaid. Give it a bit of time. If payment is only a few days late, that is not unusual at all.
Document your invoices and formal requests for payment, and absolutely consider small claims court if it comes to that. But also understand that these things happen and it is best to be prepared for late or unpaid work on occasion. It happens to all businesses.
Except they’ve also locked Hope out of the WorkTools for their site, which I take to mean they have no reason to keep working with her, and want to forestall any attempts at retaliatory sabotage. And the reason they’d fear that is they’ve stiffed her big time.
Possibly. But you’re almost always better off being persistent and reasonable for a reasonable amount of time (certainly more than 4 days…in most businesses there’s an unspoken grace period of at least a week) if you wish to be paid without having to go through the hassle of small claims court.
Ugh, that really sucks! I don’t know the specifics of the technology you work with, but in the future could you not give full permissions over to the client until you’ve received your final payment?
Hi Hope,
Sorry to hear that.
I agree with the others to not give up yet & e.g. write the paper invoice, take it to small claims court etc.
Have you called the client?
Maybe that’s another route to go through…
How did you acquire this client? Referred to by others ? So maybe tell that client you were happy for the referral at first but now ended up with unpaid bills? Or ley linkedin at least know about the outstanding payments?
Others have also suggested some ways to prevent that from happening on the future…
Good luck!
I used to work for a small company whose owner expected payment quickly, but paid his own bills as late as possible. That was his M.O. Just who he is as a person. He paid the most important bills first, the loans and the suppliers who wouldn’t give him more materials until the previous ones were paid. The less important accounts just sat there aging until he had enough ‘extra’ to get them cleared up.
Don’t count this as a lost cause because they’re five days late. Just continue to send an invoice, by email, text, snail mail. Do it every Monday. After a month, start adding a percent as a late fee. After another month, add a bit more. Document it. It may take a while, but at some point, you’ll get paid – probably just the original agreed upon amount, without the ‘fees’.
Do not give up on this money.
This is terrible. Has he mentioned any issues with the work that you did? Or do you think he is having financial difficulties? Sounds like something is up and I would want to get to the bottom of it.
Social Media is a powerful tool….you could always post about his business and the fact that he did not pay his big bill for work you completed. You could always mail or email him a note first saying that if you don’t receive payment by a certain date that you are going to go on social media and review him and his lack of payment and encourage people not to use his business.