How to Deal With Offline Clients Who go For Months or Years Without Paying
It’s exciting when you hear how people start as freelancers then turn their experience into something beyond just freelancing- an online business enterprise. The beauty about the process is – you never know when it happens because you are having fun while at it.
That’s why if you are freelancer, you should be proud of yourself and what you are doing. It takes courage to commit freelancing as a full time job. In Africa, people will not take you serious if you tell them you are a full time freelancer and you are not attached to any company. Its really hard to explain to everyone what Freelancing is especially to the old school folks aka industrial age guys.
And this takes me to my point of the today’s blog-posts – dealing with offline clients. In many occasions, you will manage to convince the ‘old school’ folks to give you business by showing them the portfolio of the services that you are providing.
And when they buy your idea, you carry out the business offline.
Why You Decide to Handle Their Offers Offline
Owing to their unwillingness to take time to understand how the online freelance economy works, you offer to serve them offline since they are ready to give you business. Unlike the online platforms where someone funds the escrow before the contract- with the offline ecosystem, you work on a written signed and stamped L.P.O (local purchase order) from the company you are working for. This confirms that you have order with the company you are working with.
What Makes People Excited to Work on Offline Projects
There are many reasons to this. One of the the top reasons is because of the budget involved. Usually, offline projects pays 2-3 times the amount you could have received online from a Freelancing site. The risks are less when the project is completed offline and two parties know each other.
Another reason is – direct human contact. You know where the company offices are and you can go there personally in case there is a payment delay and vice versa.
The problem comes when people overlook the downside of this type of projects or contracts which is the risky part.
What People Overlook
First thing is, the time it takes for one to receive payment after completing the contract. This is not determined when you start the job-you just use estimates. Even if you complete the job to satisfaction, you will still need to give the company a grace period of 30 days to process your payment. The 30 days may extend to even 3 months or 1 year if its a government entity you are dealing with.
On the other hand, if you are dealing with an individual, then that will depend of many things. Individuals are the most difficult ones. They may take many months or years before they pay you. I have a client who has taken 6 years before coming to take their wedding DVD.
You can imagine, if 90% percent of the clients you serve don’t pay you on time, how will you survive? It’s really hard. You have bills to pay and new projects to finance.
Dealing with clients indebted to you
If it’s a government agency
First things first, if it’s a government agency, the furthest you can go is writing notification letters to procurement departments to look into your payments as a priority. Make sure you have followed the right procurement procedures like writing a delivery note, and submitting the invoice for your payment to be processed. Sometimes, the approval process is long in some arms of government because of security measures.
If it’s a private company
If it’s a private company or an individual, propose to have a non-disclosure contract to be signed by both parties at the beginning of the contract.
This way, you can have clauses within the contract that defines how you will be paid. You can propose to be paid after certain milestones have been reached.
Most private companies are flexible when it comes to making payments as long as you have completed work to satisfaction. But an N.D.A is very important to have in handy for reference when requesting for payments.
Other Approaches to Get you Payment After a Long Duration time – more than 6 months
- Don’t get angry. Anger will not get you anywhere unless it’s rightly directed. For example, you cannot start threatening a government Agency or a company because you are desperate for money. If you have to do it, have a plan so that sounds professional.
- Give them a window period for them to settle your payment – First, do this on e-mail or physical signed letter then follow it up with a phone call to make them take action on your request. Be as professional in your conversation as you can.
- For the cases where you did not deliver final project files – Use them as a hook to demand for payment. If say after 1 year, the client finds an urgency of using the project you completed and starts pressuring you to deliver- ask them to pay you first. That’s the only way you will get paid by this type of client.
- Destroy the files or delete them from your system but first inform your client 30 days prior. This way, if you take action, they will be aware of it.
- Put a penalty on projects not paid for and collected within your stipulated duration. For instance, you may say – if you don’t pick your project within the next 3 months, it will attract a penalty of 10% every month of the cost of the project.
This is an issue that requires a lot of creative approach. Otherwise, you will not be paid and you will fall into a lot of debt. Always stay positive and use positive language always.
And that’s it from me.
Until next time, bye bye and take care. And if you need help to create and produce professional screen-cast videos, let me know here.
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