I can’t understand why it happens, but it’s common. Customers want work done fast, but won’t extend the same urgency to getting you paid for it. Like with most issues in a client relationship, it can be alleviated by setting some expectations upfront. I think of this as creating a kind of social contract, one that people feel stronger about than a legal one. After all, not many of us have been sued, but most of us know what it feels like to break a personal commitment to someone.
I have a few tactics for avoiding non-payment, but even they won’t stop it 100%. You’ll encounter it one day, and it feels crap. But remember this is a business, and when it does happen, learn from the experience and identify how to stop it happening again.
Take a deposit
A deposit shows respect for your time and commitment. Paying for services in advance is rare but to me it makes complete sense. Generally 25–50% is an adequate commitment and will weed out anyone who is trying to pull a fast one. If your client can’t pay a deposit, they probably don’t have the budget to pay you in the first place. There are lots of excuses as to why a client can’t pay a deposit but for me, it’s non-negotiable.
Freelancer friendly terms
Insist on 7 day payment terms. Because there is really no reason to delay payment once a service has been delivered. Who cares if it’s their company policy to pay after 90 days? It just isn’t right and frankly I think it’s a bit of a con.
Signing a standard supplier contract is vital, but I also implement an interest bearing non-payment clause to add a bit of urgency to the matter.
You also have legal options other than the courts, such as services that will follow up on your behalf, and even debt collection agencies. The key thing is to not worry too much about something that you don’t have much control over — it’s just unnecessary stress. Think about it happening, and prepare for it.
Break your work up into milestones no longer than a month apart. Time based milestones for payment mean you will always be able to pay the bills. Nothing fucks a project up quicker than being distracted about how long it’s going to take to get paid for it. Both you and your client will benefit from the focus that milestones give you.
Payment milestones can be, and should be in my opinion, separate from project milestones. Sometimes work can get extended or more complex outside of your control — and when that happens, you need the security of being paid to help you solve those problems effectively.
With enough experience you’ll develop an instinct for the type of person that is like to flake on you, as the warning signs are quite obvious in hindsight. When you get that feeling again with a new client, don’t hesitate to go with your gut.