Mr. A’s business is going gangbusters. It feels like he’s working more hours now than when he held a forty hour a week job.
One little hitch…
He’s working and working and working, but he’s not getting paid.
Yes, you read that right.
His most frequent client paid him for two months worth of work, with a suspicious looking check. It looked like one of those checks that come from your credit card company, but it looked like it was printed on copy paper, the paper was very thin. I called our bank to ask about it, and they mentioned using a black light to see the watermark. We own a black light and our son knew where it was at. We found that the back had invisible writing on it that said “Official Document”. Since it seemed like a real check, we went ahead and deposited it.
The check was returned unpaid within four days.
The client claims the money has been removed from their account.
Our bank resubmitted the check and put a hold on the $4000 until the 28th of April.
Mr. A’s truck’s transmission has been acting up and he finally took it in this morning, hoping it was something simple. It wasn’t. That repair is going to cost $950.00. Strangely enough, I feel comfortable with all this. Normally I’m freaking out.
It’s really hard running a business when you are afraid people aren’t going to pay you, or giving you hot checks.
Well, I guess these are the pitfalls of starting a new business. It’s definitely a learning curve.
One thing we’ve determined, we won’t be taking credit card checks again.
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Client Customer Relationships are crucial in business. Making sure you have a contract up front, as well as have provided your customers with an estimate and a quote are ways to protect you in the event that a client does not pay. I’m not sure what state you’re in, but in the event a client does not pay, you may be able to use small claims court.
but yes, business can be tough. Sometimes you’ll have to take a non payment, but always always always make sure you’re up front about the cost before the work is done, and have it written some where.
This will alleviate a huge amount of issues.
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this is one of the most annoying things about running your own business! I think it depends on the sort of business you run what works best.
I am fortunate that most people pay me cash on the day, I have a strict payment and debt collection policy that they have to sign before I will do any work for them after losing money on one client.
Could he get a deposit or schedule progress payments? Don’t forget to add interest and collection charges to the bill.
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