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Best way to follow up non-paying clients?

I run a training business and have a dozen or so clients who have attended our training courses on a payment plan. Some of them have stopped paying, dropped out of contact, don’t respond to phone calls, emails or sms.

They owe up to $6500.

What are some proven or best practice methods used to encourage and cause non-paying clients to actually pay?

| 👁 631 | Posted November 24, 2018 | Share on Facebook | Twitter | Google+

| Modified: November 24, 2018 | Author:

9 Comments

fozrok 1 year ago

Thanks. They arent local. We provide our service nationally, but still some good ideas.

CapeMOGuy 1 year ago

Are they local? Go see them. I owned a business and would bring them a copy of the invoice and say, I wondered if you had misplaced the original or if it got lost in the mail, here is another copy. It's a little late can you cut a check for me now? Gives them a way to save face. Edit: To prevent future occurrences, make this training payable in advance for new customers. You can always issue a refund if they do not show.

confiscate11 1 year ago

did they pay you more than the original 15k? because otherwise you just gave them an interest-free loan of 15k for many years. 15k that you could have used years ago to grow your business

[deleted] 1 year ago

In the past I have placed lien's on their businesses. You can't be in a hurry because it will only mean anything until they need to get a loan, take financing or try and sell the company, but when they do, they have to pay you first. I did this with one company that owed me $15k. Couple of years went by and then they came up to me a trade show asking what they can do, since they had to do some business deal that required our lean being lifted. I said, no problem: pay me. They did.

ZERO2236 1 year ago

I do a 5 step escalation process. In the process of the sale, set the expectation up front. Payment is due by x and late payments have y penalty (I state the obvious because many small operations are soft here) When someone is late, call and remind. Remind of the penalty. Timing depends on your business, maybe a week behind give them a call? If it is late enough and you feel like they may not pay, offer a discount if they pay soon. For example if they're 2 weeks late, tell them they can get a $50 (or w/e) discount if they pay by the weekend. If they pay, remind them that they need to pay on time and thankfully you can discount them this time, but not next time (or you will create reoccurring discounted clients) If it is far too late I would add on your penalty fee and remove their membership until they pay. Maybe at the month mark? Finally, let's say 2 months go by, sell the debt to a collection agency (you will need to have good records to do this. But you'll get money this way from clients who may never pay or return to your service) The thing to remember is every client is different. Some may never pay. Some may wait to pay until they feel they're getting a deal. Some may pay when there's a penalty such as losing membership, and others may pay only when forced. MOST of the time these are not good clients to keep around, and if someone likes your service enough to recommend it then they will likely pay on time. Find more people that pay on time so the people who don't become a very small minority.

IDidReadTheSideBar 1 year ago

You could try mailing them a letter and let them know if payment is not made it will be sent to collections. More so of a scare tactic that worked for me once.

tellin_it 1 year ago

Change your biz model to pre pay Improve your product or service so clients actually want to pay for it Focus on the cream of the market: people who value quality AND have money

[deleted] 1 year ago

Im not a huge fan of suing clients. If you have them served and they dont show up then you win. Now they owe you money but with an official judgement! wait where did we start? Oh basically here. Could have a collector go after them, not a fan either. Collecting money is a pain. I feel if your company is small and the community you serve is small it can backfire. Unfortunate. Gotta do what ya gotta do.

renderloading 1 year ago

How are your contracts with your clients? Are the terms set In stone in the event of non payment? We need a little more info to help. Thanks!


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