Non-paying customers !!!

Savvy_Sue

[quote=[Deleted User];48537703]Got no proof of her owing it anyway - its a verbal agreement so she'll probably say she paid or something anyway.[/QUOTE]You mean you don't have a duplicate receipt book? I bought one for less than £2 the other day: someone pays you, you write a receipt, give them their copy, leave yours in the book. They often have a space to show outstanding balance as well.

She says "I paid", you say "where's your receipt?"

CKhalvashi

[quote=[Deleted User];discussion/3610469]So annoyed at this.....

Wife just did well over £500 of aestehtics work for someone today. Confirmed price in advance etc.

After she'd done it woman asked her to drop her around cashpoint machine so she could get money. Off course, max she could get out was £200. Try going into Tescos and asking for £100 worth of food but moaning you've only got £50 on you...

Now we're £300+ short and woman is going to pay by bank transfer but I smell a scam here......

Obviously, we cant be so rude as to ask for money up front but I'm so annoyed that someone doesn't make sure they can pay first before doing this. If this person doesnt pay what recourse do I we have?[/QUOTE]

ANY private work coming into our studios/event management team is 50% upfront, this will usually (but not always) cover our costs in the event of non-payment later on. I always ask this to be cheque/card + proof of ID so we can verify the identity later on if there’s a problem, especially for first timers.

If you are scammed, speak to Action Fraud and your bank, as they will be the best people to advise and act on this.

C

texranger

CKhalvashi wrote: »

ANY private work coming into our studios/event management team is 50% upfront, this will usually (but not always) cover our costs in the event of non-payment later on.

exactly, even if it covers 80/90% of your costs at least you are not looking at 100% loss

CKhalvashi

texranger wrote: »

exactly, even if it covers 80/90% of your costs at least you are not looking at 100% loss

It will cover out-of-pocket minus wages, at a bare minimum. At the same time, I’m not making a complete loss, especially as several of the companies that we’ve integrated in have been financially unstable, which was my reasoning behind this, however this is even the case with the company now!

Edit - Nobody has ever refused this, and it’s a great cover for wasted time, also.

Mistral001

Some people have mentioned upfront payments. The OP is reluctant to do it perhaps for good reasons in that it might put off a lot of customers, especially if it is not standard practice in that particular business.

However, it is something worth considering in but if doing it remember as with all aspects of providing a service, the client/customer has to be allowed to make a choice. I have found that in business it is easy to forget that. We can often assume that just because we are providing a very good service at completive prices that there should be no argument over money. However, client/customer do choose. They often choose an inferior service at a high price and go away quite satisfied with their choice. They also can choose a superior service at a lower price and go away dissatisfied. But it is important to the customer that they are the ones that have made the choice.

Upfront payments are part of what the prospective client/customer has to consider. Some prospective client/customers will not be happy with it for various reasons. They might think that they will get have no leverage when seeking a remedy when after they get the service they think it is defective in some way. They might be potential fraudsters and have no intention of paying. Also they might be insulted because they think that you are implying that there is doubt as to whether you will or can pay.

I have found that if you have an upfront payment policy, you have to make it clear as earliest as possible in the conservation with the prospective client/customer. Also the policy has to be very easily understood by the client. You might want to have it only for services over a certain amount or certain services where there are large amounts of materials etc. I would have it made out before hand and keep to it. Clients/customers often talk to each other, so if one client gets a wiff that they are being asked to pay more upfront than another they will want to know the reason why.

texranger

Mistral001 wrote: »

Some people have mentioned upfront payments. The OP is reluctant to do it perhaps for good reasons in that it might put off a lot of customers, especially if it is not standard practice in that particular business.

However, it is something worth considering in but if doing it remember as with all aspects of providing a service, the client/customer has to be allowed to make a choice. I have found that in business it is easy to forget that. We can often assume that just because we are providing a very good service at completive prices that there should be no argument over money. However, client/customer do choose. They often choose an inferior service at a high price and go away quite satisfied with their choice. They also can choose a superior service at a lower price and go away dissatisfied. But it is important to the customer that they are the ones that have made the choice.

Upfront payments are part of what the prospective client/customer has to consider. Some prospective client/customers will not be happy with it for various reasons. They might think that they will get have no leverage when seeking a remedy when after they get the service they think it is defective in some way. They might be potential fraudsters and have no intention of paying. Also they might be insulted because they think that you are implying that there is doubt as to whether you will or can pay.

I have found that if you have an upfront payment policy, you have to make it clear as earliest as possible in the conservation with the prospective client/customer. Also the policy has to be very easily understood by the client. You might want to have it only for services over a certain amount or certain services where there are large amounts of materials etc. I would have it made out before hand and keep to it. Clients/customers often talk to each other, so if one client gets a wiff that they are being asked to pay more upfront than another they will want to know the reason why.

what a load of rubbish

it is normal practice if you offer such a service your ask for an upfront deposit. its easy to get trading standards etc to point you in the right direction about getting appropriate policies setup.

Mistral001

texranger wrote: »

what a load of rubbish

it is normal practice.......

And a good evening to you too texranger

pitkin2020

texranger wrote: »

what a load of rubbish

it is normal practice if you offer such a service your ask for an upfront deposit. its easy to get trading standards etc to point you in the right direction about getting appropriate policies setup.

hmm I don't totally disagree with you but TBH this is a newish way of doing business, 20 years ago you wouldn't have dreamt of paying or even asking for a deposit upfront unless it was to cover materials. Now though too many people have taken advantage and albeit a minority have pretty much spoilt the trust between consumer and business that from a business point of view its not worth the risk.

I always take a deposit upfront and if its under £100 job its full payment upfront. It was a policy I had for a few years but was quite relaxed about it until about 2 years ago when I had 3 reluctant customers (all in he same month would you believe it) who didn't want to pay a deposit upfront. I gave them the benefit of the doubt and did the job anyway 2 took over 6 months to pay and the third was written off in the end.

I think if you are upfront with the customer and explain clearly why you take a deposit there should be no issue and the deposit should be a sensible amount which I would say is no more than 50% of the total. Any customer who messes about paying a deposit is likely to mess about come the final bill time and depending on the type of service you provide there maybe no real way of getting your money back without incurring more costs.

Mistral has covered some of the concerns from a consumer point of view and they are valid and fair concerns, especially regarding fraudsters. As a new business you will find it harder for people to accept paying a deposit then a more established business, same as if you run your business from the back of van rather than premises. Personally though I would rather turn a job and focus on getting two more jobs in the door than I would taking the chance that I have to mess around chasing people for payment over the next 6+ months.

paulwf

Any business will have a couple of non-paying customers and that is why profit margins have to allow for shrinkage i.e. theft and fraud. That doesn't make the loss less painful but if you plan for it it will hopefully help with cashflow.

If I was the OP the first step I would take is to have a complaints procedure written into the contract, and it might be worth contacting your insurance providers to help with that. Is there a third party such as a trade association or independent professional who can judge any disputes? It seems a very subjective area so how does anyone decide whether the treatment worked or not? I can't answer that one but I expect taking photos before and after would at least help to document your case.

To get payment up front a good way is to run through the charges then simply say "and how would you like to pay?". If you say it in a natural way the customer will assume you always take payment up front. Don't say "would you like to pay now or later?" as of course they will always say later. I understand the points of view that say it is hard to take payment up front - just think about that scenario in a restaurant! - but I think you could take payment on the day just before you start the procedure. Heck I wish they would do that at the dentists instead of trying to sort payment and appointments out just after you've had a tooth extracted and can't speak!!!

[Deleted User]

paulwf wrote: »

Any business will have a couple of non-paying customers and that is why profit margins have to allow for shrinkage i.e. theft and fraud. That doesn't make the loss less painful but if you plan for it it will hopefully help with cashflow.

If I was the OP the first step I would take is to have a complaints procedure written into the contract, and it might be worth contacting your insurance providers to help with that. Is there a third party such as a trade association or independent professional who can judge any disputes? It seems a very subjective area so how does anyone decide whether the treatment worked or not? I can't answer that one but I expect taking photos before and after would at least help to document your case.

To get payment up front a good way is to run through the charges then simply say "and how would you like to pay?". If you say it in a natural way the customer will assume you always take payment up front. Don't say "would you like to pay now or later?" as of course they will always say later. I understand the points of view that say it is hard to take payment up front - just think about that scenario in a restaurant! - but I think you could take payment on the day just before you start the procedure. Heck I wish they would do that at the dentists instead of trying to sort payment and appointments out just after you've had a tooth extracted and can't speak!!!

Yep. It seems to be a problem..

Current status is we've now sent her a letter advising her that if she pays in full and is polite (we had a few nasty texts) then we will consider assisting her with any problems she perceives. I think thats fair enough.

Unsurprisingly, no reply yet. This makes me think she always intended never to pay the balance and just tried it on with the first payment too.

We do have a complaints procedure which the insurance company ask us to do. Basically, its put it in writing. However, my opinion is if she hasnt paid for the service then shes got no right to complain.