Customer skips invoice :(

[lendaddy]

A customer of mine missed an old invoice on a recent payment. We offer a 2% 10 NET 30 discount which they took on the two that they paid. Missing an invoice is not uncommon so I shot them an e-mail reminder asking if they needed a copy of the missed invoice. Their response was shocking in it's brutal honesty

"We have the invoice. We just missed the 10 day discount window so we will pay the first Friday after 45 days."

Customers play games all the time to scam a discount, but I've never had one admit it before.

[TerryBPP]

Please, I had to tell a client that we would not make any further submittals on their behalf until the $105,000 in outstanding invoices were paid. They were 204 days overdue!

Their response: I can't believe you would hold be hostage over this. I am a valued client and should be treated as such.

[NICKG]

len, it may be helpfull to add, in the future, a note on your invoices "invoices paid after 30 days subject to a 5% late charge"
end of problem...

[Jims5543]

Want one better?

Title Company named after this country slowly builds an outstanding balance to over 11K, we start to hammer a them to pay up.

To complicate this, they no longer order from us because their parent company now owns a Land Surveying company that subcontracts out the work to local surveyors. We are a subcontractor.

We are told by the branch manager to drop it, or they will make sure the Surveying company stops using us. This surveying company is one of our largest customers right now with the market the way it is. We cannot afford to loose them right now.

So I have to eat 11K in past due bills. You may ask how I let them get in so deep, this is 1 months of invoices for 1 office. It was easy for them to run up a balance like this.

How is that for a scam and blackmail all tied up in one?

I also had a builder go belly up and leave me holding another 10K in unpaid invoices. We cut them off when they fell behind and they continued their projects with another surveyor. Now we are putting liens on all their customers houses.

I can go on and on... There is easily over 50K out there right now owed to me with current customers that choose to wait 3-4 months to pay. Hammer at them and loose them and I cannot afford to loose any of them right now.

[lendaddy]

Yea, we tried the fee once, they just will not pay it. They know they have us over a barrel. What am I going to do about it?

Like I said, scamming for discounts is not uncommon (my personal favorite is when they write a check taking all available discounts on that date...then mailing it 2-3 weeks later). It's the stones that gets me, big greasy stones.

[Porsche-O-Phile]

Or require payment in advance.

[TerryBPP]

Our current unpaid invoices = $750,000 +.

When you deal with developers, real estate agents, and contractors don't expect common courtesy or even getting paid for work done.

[lendaddy]

Originally Posted by Porsche-O-Phile

Or require payment in advance.

Yea, that would happen

Manufacturing just doesn't work that way.

[stomachmonkey]

Originally Posted by lendaddy

A customer of mine missed an old invoice on a recent payment. We offer a 2% 10 NET 30 discount which they took on the two that they paid. Missing an invoice is not uncommon so I shot them an e-mail reminder asking if they needed a copy of the missed invoice. Their response was shocking in it's brutal honesty

"We have the invoice. We just missed the 10 day discount window so we will pay the first Friday after 45 days."

Customers play games all the time to scam a discount, but I've never had one admit it before.

I understand your frustration. Been there. But they are not really scamming a discount if you offer it for payment within 10 and they pay within 10.

If they miss the 10 then they will do what all businesses do, pay as late as possible.

Now dating checks and sending them later, that is scamming and scummy.

I'd modify my contract so that the discount only applies to payments postmarked within the 10 day window and received no later than 5 business days after day 10.

[dad911]

Originally Posted by Jim Cesiro

.....
I also had a builder go belly up and leave me holding another 10K in unpaid invoices. We cut them off when they fell behind and they continued their projects with another surveyor. Now we are putting liens on all their customers houses.
....

Did you work for the builder or homeowner? Liens post closing? Not only does that seem wrong, how is it going to stick?

[lendaddy]

Originally Posted by stomachmonkey

I understand your frustration. Been there. But they are not really scamming a discount if you offer it for payment within 10 and they pay within 10.

If they miss the 10 then they will do what all businesses do, pay as late as possible.

I couldn't disagree more. This is at best a loophole in the wording of age old industry lexicon. They know damn well they have no right to a discount on recent invoices while old one languish.

If the invoices went to different departments in a huge company or were paid by different departments I could understand, but this is not the case.

This company looks at a stack of invoices and instead of paying the most due they pay the most recent to take a discount...this is a scam.

[LeeH]

When we owned our business it was typical that the larger the customer, the longer they would drag out the payment. I found that calling the customer's A/P department with a sob story ("We're a very small company.") would usually yield results. Sometimes I would just happen to be in the neighborhood with the new invoices and would use that opportunity to discuss the past due stuff.

I don't advise showing up for a meeting over unpaid bills in your 911.

[Moneyguy1]

The joys of private enteprise.......


Ain't life grand?

[gassy]

A few years ago our biggest two clients went out of business within 6 months of each other--unpaid bills equaled $650,000. Down the drain. A class action against the parent company of one of them netted us $7000. Big deal.

[stomachmonkey]

Originally Posted by lendaddy

I couldn't disagree more. This is at best a loophole in the wording of age old industry lexicon. They know damn well they have no right to a discount on recent invoices while old one languish.

If the invoices went to different departments in a huge company or were paid by different departments I could understand, but this is not the case.

This company looks at a stack of invoices and instead of paying the most due they pay the most recent to take a discount...this is a scam.

Ahh, did not get that from your initial post.

You should close that loophole.

[stomachmonkey]

Originally Posted by lendaddy

I couldn't disagree more. This is at best a loophole in the wording of age old industry lexicon. They know damn well they have no right to a discount on recent invoices while old one languish.

If the invoices went to different departments in a huge company or were paid by different departments I could understand, but this is not the case.

This company looks at a stack of invoices and instead of paying the most due they pay the most recent to take a discount...this is a scam.

Ahh, did not get that from your initial post.

You should close that loophole.

[TerryBPP]

I wish I could pay my bills when I felt like it.

We had a 1st time developer make $12 million (take home, not gross) from a project we did and then complained over a $1500.00 bill.

You have hit a sore subject with me. Can you tell?

[Mule]

The other side of the equation. I had about $20k going on 90 days from a good customer. The (incompetent sounding) payables woman tells me it will mail on Thursday (Atlanta to Chattanooga). Friday no check. Monday no check. Tuesday no check I call. She assures me she mailed it. I'm skeptical. Wednesday, Thursday, no check. Friday I call again. She swears up & down she mailed it. I say, stop payment, re-issue, fed ex. She begs me to wait a little longer. Monday, no check. I call. I say that they could have given the check to a blind, tree legged dog & it would be here by now. Quit the crap & send me a check! She says if it's not there in the morning she ill re-issue & fed ex. Tuesday am the check arrives, with the exact postmark date she said she mailed it on. 11 days to make a 1.5 hour trip. Neither rain, nor sleet, nor gloom of night, or something like that.

The USPS furthering the cause of customer relations.

[Porsche-O-Phile]

You could always demand a percentage as a retainer/deposit. That's how we do most of our contracts - X% to get going, Y% at some milestone (60% completion, usually) and the balance upon completion. You could implement a policy like that for all but your "preferred" customers (who get standard 100% invoicing) and tell everyone that you're doing this (and guess what, you're not a "preferred" customer, in not so many words). It's a subtle way of telling them, "if you're going to play these games with our billing, we're going to make it harder on you, but not to the extent we're willing to throw away the contract". Basically call their bluff. Or simply tell them they're no longer eligible for the discount at all.

My firm pays EVERYTHING on receipt. One thing I absolutely believe in (especially in business) is "pay your bills on time". I don't care if some bean-counter tells me we're losing $100 a year in lost interest gained by holding the funds or whatever, clients, customers, consultants and other professionals recognize it and appreciate it. I believe it comes back to us in the form of healthier business relationships and more work.

One of our former clients used to have a standing "120 day clock" for all invoices. Can you believe that schit? FOUR MONTHS to even CONSIDER getting paid. A small business (even many medium ones) simply can't operate running continuous deficits or "gap" measures like that. Glad to have better clients now.

[lendaddy]

Different industries. The big three release funds and it flows down hill in automotive. Paying within 30 or getting anything up front just does not happen.