[consulting] Proper Collections Procedure

[Evan Leibovitch]

Sami Khan wrote:
>> - to exchange information on problem clients?
>>     
>
> That's what this thread is about,
To an extent.

When push came to shove, and the name of the client was requested, there
was (understandable and reasonable) resistance. Exchanging this kind of
information could present some legal risks -- I don't know for certain,
but I wouldn't discount it.

> and I would agree with you that pooling funds and outsourcing this job might be better. But is it really a problem
> of them being able to pay or is it more over that they're difficult people to deal with? I got the impression that it was the latter.
>   
Problem is, there are often multiple sides to stories. There can be
problem client and problem developers, and I know that I certainly have
no interest in either:
a) assuming 100% innocence by the contractor
b) playing arbiter between contractor and client

>> - to exchange information on business practises?
>>     
>
> We already do that through this group, so it's not as much of a problem in my experience.
>   
Actually, it's a big problem, arguably the heart of the headaches at hand.

If there was a good (and not necessarily lengthy or legalese) contract
that outlined payment schedules, milestones and/or other frames of
reference for achievement and payment, much "angry client" syndrome
could be avoided. An ounce of prevention, etc.

What I mean by sharing business practises extends far beyond what I've
seen here so far, to contractors sharing their contract forms and "new
customer" procedures, and between us developing sound boilerplate
contracts and best practises.

Spending a few dollars getting legal advice on a good contract is far
cheaper -- and easier on the nerves -- than getting legal advice for
litigation.

> A business co-operative sounds like a good idea. A trade union does not. A
> trade association is interesting but I don't think the problems that trade
> associations address are not really problematic for consultants as there
> are plenty of sources of information, etc.
>   
Many trade associations exist primarily to define standards, publicize
their field, and in some cases protect their members through political
lobbying. Providing information to members is often a secondary task.



>> As has been mentioned, credit bureaus exist (and have their own legal
>> liability issues to deal with) in order to provide businesses (of all
>> kinds) with information on clients who don't pay their bills. They also
>> help (at least partially) in separating clients who are financial
>> deadbeats from those who have (they believe) legitimate claims of
>> substandard work.
>>     
>
> I don't think that financial dead beats is the underlying problem.
>   
The answer to the other problem lies in prevention (paper contracts)
rather than cure (sorting out differences of expectations).

I've come across my share of clients who use claims of inadequate work
to mask the fact that they were deadbeats, and used the disputes to buy
them extra time to pay (or in some cases, pressure for a reduction in
the previously-agreed prices).

If the problem is a "difficult client" who's not a deadbeat, then
there's a communications problem and chances are high that the client
thinks they have a "difficult supplier". With a contract ahead of time
chances of miscommunication (or selective memory) are greatly reduced.

> I think we need a different thread to discuss just that if that's what we want to actually acertain. This thread was more over for the collection issue and I feel that it's digressing.
>   
It has no choice, since the original thread is dead :-). Micheal's
client did pay in the end, all that's left to talk about is the future
and the hypothetical.

I simply can't agree with Michael that a properly worded contract
wouldn't have helped. It would not completely avoid conflict if the
client is insistent on being difficult, but a contract could have
protected Micheal by making clear what was expected in order to justify
payment. It's my own observation that most clients (who aren't
deadbeats) don't enjoy the conflict any more than the contractor,  but
for some reason believe that what they received was not what they had
expected. A reasonably-clear contract goes a long way toward clarifying
expectations and reducing (if not eliminating) future misinterpretations.

- Evan