Customer won't pay, help please

Kass

My husband runs a small business and one of his customers is refusing to pay the final invoice because she thinks it is too expensive. She has gone online and sourced the doors that my husband fitted for her at a cheaper price and says she will only pay this price. My husband offered to prepare a written quote but this was declined. The lady in question is denying this and says that my husband gave a verbal quote, which he did not. My husband has already reduced the invoice as a gesture of goodwill but the lady still refuses to pay the final amount. Could anyone kindly tell me where we stand with this? The final amount is not a great deal - a few hundred - but it makes a real difference.

earthstorm

send her a LBA (letter before action) giving her 14 days to pay or you will start proceedings to recover the debt.

Wywth

Your husband should ask his customer if she often walks out of Tesco items in hand without paying for them, as she could buy the same item in Asda/Sainsbury/Morrisons for less. :cool:

Horace

Does your husband have a clause in his terms & conditions about the goods remaining his property until paid for in full? If not then he should add this to his terms & conditions.

As she has failed to pay for the goods, you could do as another poster has suggested send her a letter giving her 14 days in which to repay the debt or the matter goes to court. If she fails to respond within that time then start court proceedings (you can do this with moneyclaim online).

Court proceedings usually shake people up because they don't like receiving CCJs.

I would not have reduced the cost either even if offered as a gesture of goodwill although I can see why he has done this. As the goods haven't been paid for maybe your husband should arrange to collect them because they are obviously not required.

Lovelyjoolz

I use these guys for my debt collecting:

http://www.thomashiggins.com/

£2 for a LBA and most pay up when they receive that on proper Solicitors headed paper.

I'm sure there are other online Solicitors who provide the same service too however

ThemeOne

In future I'd advise your husband to deliver a written quote to potential customers whether they want one or not. This way they can't later claim they didn't agree to the amount, as it seems this customer is doing.

Letter before action does seem to be the way to go - she's probably just trying it on. I think I used Thomas Higgins myself once (their web page looks very familiar) and the £2 letter resulted in payment.

Wywth

Lovelyjoolz wrote: »

I use these guys for my debt collecting:

http://www.thomashiggins.com/

£2 for a LBA and most pay up when they receive that on proper Solicitors headed paper.

I'm sure there are other online Solicitors who provide the same service too however

I pay just 25% of that for Royal Mail to deliver my LBA's for me :money:
(it's not recoverable)

googler

Wywth wrote: »

Your husband should ask his customer if she often walks out of Tesco items in hand without paying for them, as she could buy the same item in Asda/Sainsbury/Morrisons for less. :cool:

... And then arrange a date for him to go and collect the doors which, she not having paid, are still his property.

Lovelyjoolz

Wywth wrote: »

I pay just 25% of that for Royal Mail to deliver my LBA's for me :money:
(it's not recoverable)

True, but I've found a Solicitors LBA to be more effective than a personal one.

pelirocco

ThemeOne wrote: »

In future I'd advise your husband to deliver a written quote to potential customers whether they want one or not. This way they can't later claim they didn't agree to the amount, as it seems this customer is doing.

Letter before action does seem to be the way to go - she's probably just trying it on. I think I used Thomas Higgins myself once (their web page looks very familiar) and the £2 letter resulted in payment.

I second the written quote

Written quote , terms and conditions and a signed agreement before any work is done.

A 14 days before action ( 14 days seems to be the accepted length unfortunately ) and them most importantly see your threats / actions through

Be warned some people are still willing to take a ccj rather then pay


Maybe think about taking deposits ?


We have been there so many times , its not fun

spacey2012

He may want to examine why he is giving unbounded credit to customers .
If he supplies before payment, that is giving the customer invoicing credit.
Most building trades that fold are due to "invoicing credit" debts.
Invoicing credit is the credit given to a customer before payment.

This is where contract come in to play, basically he should not be giving any credit without a water tight contract in force that retains a lien over the materials.

This is a major cause of trade business failure and a couple of hundred pound paid to a contract legal adviser to draw up a contract that looks like a quote that has to be signed by the person receiving the invoicing credit.

This can be the difference between going bust or staying in business.
A contract which secures lien makes the goods supplied the property of the business until the account is paid in full and bailiffs can be instructed with a simple court order to remove the goods not paid for.

He should also have a credit limit, an amount he takes steps to safeguard, some will not grant over 5k of work without a credit check performed on the customer and some will require capital security over 10k such as a bank guarantee letter or Guarantor deed.
I understand this wont help here, but it may prevent him going bust in the future.
The days were you can work on a nod and a wink are over, his only option without a contract is county court and this can be a nightmare.

Ask him to sort out his paper work and have default contract drawn up to protect the materials at least on any future work he does, or he is not going to be in business very long as the suppliers will bankrupt him .

Looking at a LTD company as well to protect your home and assets is a good idea, then any other bad debt he has is limited to the company not him.