From a friend who is an established consultant, who has both worked for major consultancies and run his own shop. He gives us these useful pointers today -
"A Primer on Collecting Late Payments"
Anyone who has ever done business has had occasional difficulties collecting payments from customers. Experience shows that putting some attention (in advance) on a couple of key items can help resolve the lion's share of these issues.
First general rule: Your written communication style and professionalism can go a long way toward inducing unwilling customers to pay up more quickly than otherwise.
Let me clarify these two terms:
By "communication style" I mean, whatever you do to inform the customer about his financial obligation -- initial written agreement, general terms and conditions, invoice, reminder letters, notice of breach of contract or other warnings, do it in a timely, crystal clear and understandable way. I recommend you spend at least some time up front thinking about what you would say in each of these documents, so that it doesn't sound as if it has been prepared in a rush or under stress.
By "professionalism" I mean striking the balance between being friendly toward your customer but strict about the payment deadlines (which you clearly set in writing at the time you made the agreement with the customer. I know a lot of business people are extremely aggressive to the point of being offensive and hostile, but in my experience you stand to lose business and create conflicts by failing to add personal consideration and the human touch.
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