Make sure your client pays his bills: play it safe from the start!

 suggestions-on-how-to-protect-your-work

Before you start working with a client there are plenty of strategies and precautions you can take to raise the chances of getting paid as close as you can to 100%. We’ve drawn up a comprehensive list of suggestions on how to protect your work!

How would you describe in one adjective your condition as a freelancer? My word would be: unsure. Especially if compared to permanent employment, uncertainty is the counter part of the “freedom” you have. You know you have something valuable but you don’t know how to trade it for a fair price and sometimes you’re not even sure you will receive something in exchange for it.

As for life in general, in the freelancing world as well it’s mostly a matter or experience. Sometimes you will get underpaid and maybe even ripped off by a client, but in the end you will learn how to prevent these situations.

Are you already dealing with a client that won’t pay? Use our 7 effective strategies to get your client to pay on time!

However, there is no need to learn how to deal with unreliable clients through scams, if we can avoid unpleasant situations we might as well do so, right? Let’s then look at what you should do before you start working with a client.

1. Become a secret agent… or just Google it!

Before you even start negotiating with a client, some investigation is compulsory. Once the first contact is established – or even beforehand if you can – take your time to look for some information on the company you are going to be working with.

The first step is obviously talking with someone you know that has had any kind of relationship with the client or company. It requires a “high percentage of luck” and it won’t happen often, but in case the event occurs, you can’t let the chance of having an direct insight on the client go by.

A good start can be just googling its name and taking a look at the search results, there is much more information in those search results that you might actually think. You can associate keywords like “review”, “clients”, “payment”, “freelance” and any other one you can think of to the company’s name and try and get some useful information. If you find any angry/unpaid freelancer story, you might as well stop here.

Try and get some insights on the way they do business in general. For example, the way they deal with customers can be a good indicator on how they might behave with freelancers too.

Visit your clients website and analyse it from a client’s perspective: does it look professional? Is it a well established business? Click on its social media channels (he should have the links on it’s website) on go through mentions and comments. Some tools that can help you with this task are:

  • Glassdoor: get reviews written by people who have been working for that company.
  • Better Business Bureau (US, Canada and Mexico): for the firm’s reputation.
  • Facebook and Twitter: take a look at comments and mentions on the company’s social network’s page.
  • Google Maps: search for business and look at the opinions.

At the end of your research it’s possible – and even likely – that you won’t have a clear picture of your client’s behavior. In this case, whether you decide to work with them or not should depend on your guts: use your instinct. I try to be more rational than emotional myself, but more often than I’d like to admit, our inner feeling can lead us to smarter decisions. So, if your brain doesn’t have the necessary information to take the right decision, let your vibes do the work.

Just remember that the more accurate information you can get now, the better you will be off later. In the end, doing some previous investigation can even save you plenty of precious time. You might get some bad feedback on the company and even decide not to work on a quote. So do it well.

2. Write it down

Even though it might not have much legal value, writing a contract and getting it signed by your employer clarifies what both sides can and should expect from each other. Even though that’s what most of us do, you should never rely just on words as people tend to ‘forget’ what they’ve agreed on. And even emails are not enough.

Having a contract signed by both of you will give you an extra resource you can rely on if your client does not respect the deal.

I know you are not a lawyer, neither am I. If you are not willing to spend some extra cash on attorney to write a contract for you – even though it could be a smarter choice – there are some free alternatives.

As a first start you can use this Work for Hire Agreement for Video Production from Docracy. On the same website you can find a vast archive of legal documents especially written by and for freelancers that might better suit your needs. Otherwise, just by googling “freelance contract template”, you will get enough results for you to find some good base to start with.

Whatever you choose, if it’s a downloaded template or a document written by a lawyer, make sure it’s a contract that suits your needs and that can work for a different range of jobs, a document that you may easily adapt by making minor changes to the main structure.

3. Edit the details

Once you have your template ready, you should start writing down the conditions on it. The most important of which concerns payment, of course. The billing details you don’t want to overlook are the exact amount you are going to receive for your work and the payment schedule. These are essential. Also make sure you specify if VAT, GST, IVA (or whatever the consumption tax is called in the country you are working in) is included in the total sum.

4. Incentives, interest and kill fee

In addition to that, you can also state in your contract what will eventually happen if payment is delayed and the interests fees that might apply. As we’ve explained in this article, you are entitled to charge an interest for late payment even if you didn’t write down in your contract. However you should specify it just so your client already knows what are consequences of late payment.

The same as you should state the exact interest that applies in case of late payment, likewise you should also offer early payment discount. Something like a 3 to 5% reduction on the overall price can be a good-enough-incentive for your client to pay even ahead of schedule. If that amount doesn’t mean a big deal for you, writing it down in your contract will give your client a good motivation to be on schedule with his bills.

5. Include electronic payment options

Transferring money via your bank webpage is an easy process anyone can do. However, different reasons can interfere and make a client reluctant to use this system to pay his invoices, especially if his bank charges him a transfer fee.

Offering an electronic payment option like Paypal can make life easier for you and your client. Not to mention the service also has a requesting payment service you can use on its website when a client isn’t following the invoicing deadlines.

6. Ask for upfront payment

This might be an unpleasant part of your contract, and the client could even be, well, disappointed, when you make your advanced payment request. But this is an important step, it means there is mutual trust.

As a matter of fact, you are the one making a sort of advanced payment by working without getting paid in advance. So you are trusting your client. He should do the same with you and grant a partial payment: that way he’s showing he trusts you. This condition is all about reciprocal respect, and that’s how you should explain it to your client.

Especially if it’s the first time you work with a client, you shouldn’t skip this step and ask for an upfront payment for your work. You can state a two, three or even four payment stages, something like: 30 % at the start, 30% half way and 40% when the work is finished. This will also work as a kill fee in case the project you have been working on gets canceled and you’re not entitled for the full compensation.

7. Keep track of deadlines

I’m a fan of digital calendars, reminders and post-its: they sync across devices and pop up on screens, there’s no waste of paper and especially because otherwise I wouldn’t remember half of the things I have to do. I don’t know how you deal with your errands and deadlines, but even though you perfectly manage without any external help in your personal life, I recommend you rely on some digital reminder to make sure you and you client are meeting all commitments.

With some easy tools like Google Calendar, Sunrise Calendar or Cal Calendar, you can easily keep track of all due dates, from your phone or PC. My personal favorite is Google’s as it syncs with another app – Keep – that lets you quickly create reminders, whether written, recorded or even photographed.

What if it doesn’t work?

You can write all the conditions you want in your contract, you can even hold some work as a hostage in some cases, but there’s always a chance your client can delay his payment or even disappear. What should you do then? If you are already dealing with this situation, you can read you article where we explain 7 effective strategies to get your client to pay on time.