Most client will pay you on time. Some will be late with sending the cheque and a gentle reminder will usually be enough to get your money. There are some clients however who will try to use your services for free. There aren’t many of them, luckily, but they are there. The problem is that it is hard to spot them at first. Every new client seems like a good guy or gal, and unless they openly state that they are crooks, you may never guess. Not until it’s too late anyway. Therefore my best recommendation would be to treat every new client suspiciously. And the best way to do that is to follow those simple steps:
Always Sign a Contract
A contract makes things more legal. Even though that even with a contract you still might get stung, it adds a bit of seriousness to the whole deal.
Few things to remember though. You should always have your own contract prepared. Do not sign a one created by the client, fair chance is that it will be set to protect them, not you.
Also, make sure that you not only include every possible “no payment” scenario but also describe the scope of work in great detail. Without it, it might be quite easy to question your work and ultimately, do not pay you.
Insist on a Deposit
Never start any work without a deposit. Even if you think that they client is the most honest man in the world, always demand a deposit and do not start any work until you receive it.
The amount of a deposit may vary greatly. Most companies charge anything between 30%-50% and I would recommend the latter.
Consider Charging the Full Price Upfront for New Clients
Taking on a new client means risk. You don’t know them and it is easy to get stung then. One of the ways to defend yourself from such thing happening is to charge new clients a full price upfront. This way you protect yourself from bad clients. And, if the client refuses to pay it, making various weird excuses, you can be sure that you were right.
Demand 3rd Party Costs to be Paid in Full Upfront
If you provide services for which you need to hire a 3rd party, I.e. printing, photography or server costs, consider asking for that to be paid before you order those services. One of the worst things that can happen to you is to get “stung” and also be left with a big printing bill.
Ask New Clients for References
One of the best ways to find out if the client is honest or an unscrupulous one is to ask the for references. If they provide them with you, it is a first sign that they are fine. However, if they decline to present you with contacts to their past vendors (they don’t have to be from the same industry as you), then you can have an alarm bell ringing.