By David Billings

Have you ever noticed that late payments happen when you need cash the most? I think there’s a World Freelance Mojo Consortium monitoring all home office billing activity.

It’s easy to get your knickers in a twist when somebody owes you money. Let’s be honest; your first concern is paying your own bills, so when you have to ask repeatedly for a client to pay an invoice, your shoulders bunch up and your brow gets all wrinkly. That’s not good posture to have when you’re trying to help other clients and bring in new business. So what can you do about it?

First things first. Before you start Googling collection agencies, I have to ask: have you tried to find out why your client hasn’t paid?

Recently, I was waiting for a check to arrive from a magazine client and wondering what happened. Things had gone so well, why would they stiff me? After asking some very strategic questions to maintain the charade that I’m a smart man, I realized that I never submitted an invoice.

I think the lesson here is obvious. Don’t tell anyone I did that, ok?

Let’s assume you are smarter than me and completed this step in the process. You might have learned that Company X only pays vendors on the XXteenth of the month. You can chill out a bit because you now know that they intend to pay you and when.

What do you do if things aren’t tied up in such a neat little bow? What if you can’t find out what they intend to do so easily? Don’t worry, we can still handle this.

First, ponder this question carefully: Which is more important to you with this client; the money or the relationship?

If you were hoping there was a simple right and wrong to this, I’m sorry. It’s a very personal question that only you can answer, but it will help you to better understand the
situation before acting.

Money

Hey, sometimes it’s just about the money. Sometimes you don’t click with a client and the work isn’t terribly rewarding. You can’t see yourself ever working with this person or company again, no matter what the pay is like. It happens.

Relationship

This is nice. It requires more delicate handling, but you should feel great knowing that you want to keep working with this client. There must be something rewarding about it besides sending the invoice.

Whether you answered “money” or “relationship,” you’re going to approach this problem exactly the same way. Understanding the difference is just to help you resolve any internal conflicts about what you hope to gain from here on out.

I know. I hear you. You just want your check as soon as possible so you can pay your own bills and move forward. That’s cool, but now I have more questions for you.

Did you have a contract?

Did you set a payment schedule?

Please say you have a written contract. Always have a written contract. The contract lays out the particulars in advance of doing any work. That way, you’ve got something on paper to go back to when disagreements or misunderstandings arise.

Setting a payment schedule is not only a good way for you to get your money on time, it keeps you in control of the work. If you establish completion phases that coincide with payments, you’re off to an excellent start. Hot tip: you can tell when a client will tend to pay on time because they will either initiate this or thank you for spelling it out.

What if you don’t have a contract? Well, all bets are off, my friend. You will be relying on the benevolence and integrity of your client. Lesson learned!

If you do have a contract, review it again. Make sure you understand it fully before you move forward with any action. Avoid the embarrassment and just read it again.

Here’s another important question for you: Are you still working on the project?

If you are, then… stop. It may sound silly to you that I even mention this, but it’s not always obvious to everyone that they’re “allowed” to do this. Let your client know (firmly, yet politely) that you must stop all work until you’ve been paid for what you’ve done to date. Do you see how valuable a payment schedule can be?

Consider how fortunate that you’re still in communication with this client and seize the
opportunity to talk it over.

It bears mentioning that whether you picked Money or Relationship, you should always be polite. Go ahead and vent to your husband, throw your potted plants out the window in frustration, but always display a calm and businesslike manner to your client. It’s not about being a pushover, it’s about taking the higher road. Besides, you will make it more difficult to collect if you’re a jerk, I promise. Making people angry at the injustice of it all is satisfying for approximately ten minutes. After that you will feel like a schmuck.

So we’ve all got our service-with-a-smile helmets on, now what? We still don’t have any
money.

Assuming that you’ve gone through the steps above and there’s no cash in sight, you need to take some action. If you’re hoping that this is part where you “get medieval” on your clients, I’m sorry to disappoint you. There are quite few steps between here and Cosa Nostra-style action and in my next post I’ll walk you through them.

Until then, I think it’s important to mention this relationship thing again.

You won’t be in any business long if you don’t make money at it, but there’s a difference between short-term money and long-term money.

Short-term money means that if you want quick cash, you might use whatever means necessary to collect on your invoice immediately. Even if you actually get paid, the likelihood that you’ll do more work for that client is chancy at best. How many clients can you do that with and maintain a good reputation? Sooner or later, the word-of-mouth marketing that works so well for some people will backfire on you.

Think about long-term money as an investment in your future. If you focus on preserving the relationship, it’s possible you will get paid late this time but also likely that you’ll have an opportunity to work with that client again (assuming you want to). On the next project, you can spell out a better contract that works to get you paid sooner.

Next: Part II: How to Get Paid without Hiring Muscle

David Billings is an illustrator, animator, and writer. He currently runs two businesses from his home studio near beautiful Mount Hood, Oregon.

David lives with his wife and children on an alpaca farm. No, they don’t really smell that bad.