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As of this writing, I’ve lost about $4,500 in revenue from clients who decided not to pay. While the vast majority of my clients have been great and have always paid on time or let me know of any concerns, this lost revenue would certainly have been a boon to my business. I’ll give you a few tips that I learned the hard way so that you don’t have to suffer the same fate.
1. Don't do spec work
This one should be obvious. Don’t do spec work! Spec means “speculative” and it is unpaid work that the client sees to make decision to hire you. Your portfolio and website should be a sufficient display of your skills, so this is a BS argument. Spec work degrades the profession and it makes the client’s expectations unreasonable from the start. The client who expects spec work will think something like this…if you can do spec work, then maybe you can do free work, then maybe you can give them a deal…so just don’t do it.
2. Don't start a project without some basic signed agreement
You need a contract of some sort. Most contracts, if the wording is obvious and sound, with no trick verbiage, will hold up in court if signed by both parties. You can look at legal templates online to find some good resources. Some things you’ll want to cover in your initial contract:
- Project deliverables
- Project timeframe and milestones
- Project cost
- Ownership of files after the work is done
Those four topics should get you going for most all of your needs. But take a look online to see what else you might be missing.
3. Make sure you're sending bulletproof invoices
You need to be sending invoices in the first place to make use of this tip. If you aren’t, get to it! There are tons of templates for invoice documents and tons of cool apps for invoicing. These apps make it simple but some are SAAS (Software-As-A-Service), so you might consider doing the work yourself to save money. This all depends on whether or not you consider the extra work a positive trade-off or a big time waster. For me, I use personalized PDF invoices that I send to clients. I also keep spreadsheets with different payments and dates for my records-keeping.
One thing to note: you might consider putting a disclaimer for late payments somewhere in your invoice. Let clients know what the due date is and when they should expect to incur fees if they aren’t getting you that dough!
4. Send lots of (email) communications and keep records!
Paper trails, albeit digital, are an absolute necessity when it comes to legal claims. The more evidence you have in favor of your argument, the better. It’s good practice to communicate with the client anyway, so keeping a solid record that is traceable is going to be your first line of defense if things start to get hairy.
You can reference the emails/letters/phone calls to your client if there is backlash, which can often resolve the case out-of-court.
If diplomacy fails, you’ll have plenty of evidence to shut them down.
5. An ounce of prevention is worth a pound of cure
This last one is really all about using your noggin' to keep yourself out of this situation in the first place. I have found myself looking back on jobs that seemed shady, but I convinced myself the client was not so bad and they would be responsible. I think the lure of easy money can have its way with us, but we must be careful.
If a client has odd expectations, demands unreasonable things, switches directions constantly or has other subtle hints that their motive is not so scrupulous, beware.
Another thing to note is payment: if they want to pay you in specific ways, and are not open to others, just be careful. Clients who want to pay in cash are the most suspect, but you will have to use your own judgement there.