Where is the money, honey?
March 1, 2017
We make pictures, keep terms, make changes in time and meet deadlines. There are several people who slave over every project in order to do the work well and in time, And none of them would ever do it as a hobby. Naturally, we expect to be paid for all the things we do.
And from time to time things go wrong: we finish the work, but still get no money. The client doesn’t want to pay for the project, and we start exchanging letters, waiting for the payment.
Ilustration Valery TheWatt
It seems like paying for something that had been done for someone is quite natural for a modern community. Some people, however, have not got the move sequence. And the company doesn’t see anything wrong in continue working on new projects, despite not having paid for the previous ones. When one goes to hospital or dines out he or she should be ready to spend money. What happens to the same people when they have to pay for some other people’s work? So, we have to face a credibility gap and somehow deal with it. And we decided to ask the colleagues how they manage to have things paid for.
Do you have a system of prepay, stress extra costs or a black list of deadbeat clients? Are there any companies which are tardy in payments? How do you make them pay?
Ilustration Valery TheWatt
1.Do you take 100% prepayment?
We never introduced full prepayment system. I don’t think any of our clients would ever agree to such format. A standard scheme is 50/50 or 30/40/30, but we have recently realized, that, even when you know both the client and the designer well, something unexpected can still occur. And it’s normal when website development can take several months, and some things can change for this time.
Finally, we have developed this system of payment:
—If a project is going to take more than a month, we take 50/50
—If a project is going to take more time, we get a prepayment of 50% and, when we this part of work is done, we continue working on the project, drawing up a weekly report which we use for interim accounts.
This scheme gives a client idea of the budget, and have no quality-benefit trade-off.
2. Do you keep a black list of clients, have a system of additional stress costs or take hostages?
We don’t take hostages or any extra stress payment. AS far as I know, the most common way for website developers is to block a client’s website until the work is paid. But I don’t think it’s possible to have normal working relations after such measures.
3. Did many companies refuse to pay? How did you manage to get the money?
I’ll tell you the common truth: the only clients who did not pay were the ones without a contract. Those were friends, acquiantances or friends of the friends. The other clients always paid for the work. The longest waiting period was about 5 months. We never had to threaten the bad payers, but we choose not to work with them anymore.
Sasha Gladkyh, Charmer
We try to take stock of the situation how adequate the clients is at the first meeting, and we also calculate risks when we estimate the budget. Another thing to be done is to divide the work into parts which should be paid one after another.
I can give you a predictable answer, I mostly work with large productions, and they deal with major advertising agencies. They are generally quite serious about the reputation, and I have never had any problems with payments. Postpayment is a common standard and is generally agreed on in advance. All the problems I’ve ever had were caused by individual customers, and after all, I decided to deal with them in order to keep my faith in human nature. I don’t really want to develop the topic, I just strike such clients (and people) out of the list.
I don’t reall remember cases when I had to shake the client’s money tree. I usually take 50% prepayment, 25% when we’ve agreed on the sketch and another 25% when the work is done. That’s the secret, which is not a secret at all.