[consulting] Proper Collections Procedure

[Henri Poole]

On Fri, 2006-08-18 at 02:08 -0700, Harry Slaughter wrote: 
> Henri Poole wrote:
> > Who is the deadbeat client?
> 
> Yeah, I definitely don't want to get into naming anyone here :)

Perhaps a private list would be appropriate (although I personally
dislike secrets in general). Credit reporting agencies do this for
individuals and businesses. A clients reputation is a very important
part of deciding whether or not to take on work and extend credit (for
those who decide to operate in this fashion). As professionals, we need
to have methods for determining whether a client is low risk.

And, any disclosure (private or public) should be done with a simple
statement of fact instead of opinion (as I did earlier by the 'deadbeat'
label) and should only be done if it doesn't conflict with any secrecy
agreements that one may have set up with a client.

> 
> Best bet is for others to try to learn from experiences such as mine. 
> This is definitely a worst case scenario for me.
> 
> Main things I've learned from my experience as an indy so far are:
> 
> - the second a client is behind on payments, stop all work.
> - always take a significant deposit up front. if client objects, pass.
> - don't let client owe you more money than you'd be willing to sacrifice 
> if things go south.
> - find a competent lawyer (...er...) and draw up a contract that makes 
> your terms crystal clear.

IMHO, all of these are very good suggestions. 

> 
> other ideas that i'll probably use:
> 
> - require frequent payments (my preference) I invoice weekly. If client 
> objects, pass.
> - Increase rate by N% and offer it as a discount for on time payments.
> 
> 
> > Any potential client that approached us that hadn't settled up with
> > someone in our community would get a cold shoulder from us.
> 
> Personally, I like this idea, but it's not very professional :)

I would argue that it is professional. There are very few professional
organizations that knowingly take on risks. When I buy a book online, I
can read reviews from peers. I am supportive of this level of
transparency and community feedback and find it very important to make
informed decisions.

If a firm is having difficulty with Haggerty, whom I know and respect,
it would make a big difference as to whether or not I would consider the
risk worth the benefit.

Perhaps this is just a personal value that I hold around transparency
that has influenced our business practices but generally, I think that
transparency is the best policy.

>