Non paying customers

[njc110381]

I'm having some trouble with one of my customers. I mow and maintain some gardens for a building company and they've always been first class payers. Always on time, never any bother. Well the month before last they decided to make the most of their 28 day payment term and didn't pay me until I sent the next invoice. I phoned the guy about it and he said they were making some changes with their accounts so it would be sorted out ASAP. I accepted that and carried on because they've always been spot on with me. Now last month has gone overdue by ten days, so in effect I've not been paid for August yet.

 

All in all they owe me about £1500 and I've just been told when I phoned today that the cheque went in the post on the 30th of last month. They always post 2nd class but I'd have thought it would have been here after 8 days so I suggested it may have been lost in the post. He said he'd look into it next week.

 

I've got a bad feeling about this. If it all goes wrong what can I do to get my money? I need good lawful suggestions. With my record as a teen I'm fully aware of things I could do to make them pay but that's not me now. I need to keep this all above board because I've got too good a life to mess up for the sake of £1500! I'm struggling financially because of this and don't know what to do about it!

[Nial]

Go round to see them and don't leave until you have a cheque in your hand.

 

Tell him if the 'original' turns up you will return it.

 

 

 

Nial.

Edited October 8, 2010 by Nial

[manxman2]

Building firms can be fickle in their cash flow, even in good times.

 

I was ripped off for 5k+ by a firm for 2 builders cleans, i actually lost about 3.5k on the deals as i paid for staff and materials with my own cash.

 

Apart from chasing over to spain to give him a kicking , i just had to let the anger go, i never did 2 jobs again for any firm, without getting paid for the first one first.

 

I got £240 of the liquidators total.

 

You were torn between the need for repeat business, and suspicion is my guess.

 

Horrible time for you, bur its time for a face to face with the person who contracted you, then you will know if they are in trouble, speak to other firms that they sub out to aswell, if they aint been paid, well its frustrating but you cant get blood out of a stone no matter how hard you squeeze it.

 

be lucky

Edited October 8, 2010 by manxman2

[Mungler]

Only ever give credit for an amount of money you can sustain not being paid i.e. if anything more than £500 credit would hurt you financially, then don't under any circumstances give them a penny of credit over £500. It's like gambling because you are gambling that you will be paid.

 

Also, in these times we are seeing plenty of builders and developers go pop.

 

In your case, if the company goes pop, without a legally enforcable PG from a Director or 3rd Party then you won't get a penny.

[njc110381]

You were torn between the need for repeat business, and suspicion is my guess.

 

 

I wouldn't say that. That's the point I'm at now really. I've been working for them for over a year with 100% reliable and friendly payment so when he first said they were making some changes to their accounts I was happy to just carry on as normal. Maybe I'm daft but there was no doubt in my mind then that I would be paid as soon as whatever issues they were having were sorted out. Now I'm suspicious - a late payment just happening to get lost in the post (the first time anything of theirs has been "lost in the post") is just a little too much to take as true. The guy also doesn't sound right when I talk to him. He doesn't seem his usual cheerful self, like he's under pressure. :look:

 

EDIT.... It will hurt, but I can get over it.

Edited October 8, 2010 by njc110381

[lineshooter]

We had the same happen, but payment was pushed from 30 to 60 and now 90 days, this can cripple many small firms, especially if most of your work is for that one company.

 

Send a polite letter requesting payment in 7 days or you will pass the matter to collection agency, I think it will cost you about £90 to claim back £1500 in the small claims court, you can claim the cost back but its more time you are outstanding payment.

 

Good Luck

[al4x]

credit check them ASAP, If you pm me thir name I can check for any ccj's and get you an idea if their credit rating is ok or iffy. Its dodgy times at the moment and many companies are suffering cash flow issues, you've been lucky if you've been being paid ahead of terms so its not that unusual if they are stringing it out a bit, but you need to make sure its not because they can't pay rather than just being slow. One thing you learn in business is work isn't work if you don't get paid for it so if you have troubles stop doing the work sooner rather than later. if you need legal letters then look up Thomas Higgins cheap 7 day letters then you just do the court action yourself through moneyclaim online. One thing I've learned is you have to be fast once you get alarm bells as they fend off going bust for a while but usually go in the end.

Of course they could be telling the truth so you have to be slightly careful not to loose a customer over being hasty

[Spaniel]

I think you will find that most businessies tend to hang on to their money as long as they can at the present time.

Im in IT and believe me we are talking some large amounts some time and yep there are the obvious issues to face when someone as not been paid.

I would say that they are either holding onto their money for there own funds to look positive or maybe they dont have the money to give you.....which is more worrying....but i think you should call around to speak to someone face/face rather then calling on the phone as you can be quite easily be palmed off over the phone...

 

Good luck hope it all works out

[ME]

We have all been here.

 

I have just stopped working with a regular customer for exactly this kind of thing. He mucked me about on payment then admitted that he couldnt pay me until he got paid. This rang alarm bells so I instantly pulled his credit facility and got paid up. He got the hump and doesnt use us anymore but there are plenty more customers where he came from.

 

-----------

 

In your case I would explain that you are a small business and that you need help from them to get to the bottom of the "missing cheque".

 

Request that they cancel the "lost" cheque and re-issue another one for you / your representative to collect next week. Get names of the people you spoke to and get commitments from them as to when and how you can expect a call back etc.

 

In the meantime tell them that your "accounts department" have put them on "stop" (i.e. you cant work for him for the moment) until the old invoices are paid up. Keep it friendly but dont do anymore more for them until you get paid up.

 

Worst ways, if they like what you do and want to carry on, then they could do a BACs or CHAPs payment.

[al4x]

also stop dealing with cheques and get them onto BACS as then they have to rely on either the Invoice getting lost in the post or having mislaid it. Funnily enough the post only ever fails with my bad paying customers and its the same characters every month. The good ones you never get a lost cheque and we even have one where you post the invoice one day and the cheque arrives two days later pretty much without fail. But hey there is no lack of money in the legal profession

[HDAV]

Dont fanny about

 

 

Gemini Debt Recovery

0844 35 10 700

 

http://www.geminidebtrecovery.com/

 

There are some key letters you need to send and keep copies of but a professional collector will collect the outstanding and cover their own fees give them a call a mate used them a few times and got the money, all of it. Soem firms will push as much as possible and wont pay until you sent the right letters. Others are good, no reason you can't keep the exisitng relationship just be polite and explain you ahve a policy taht beyond 30 days its passed straight to XYZ collections

[manxman2]

!!where you post the invoice one day and the cheque arrives two days later pretty much without fail.!!

 

I had one like that, royal bank of scotland, there was no shortage of cash there either, i saw the volts many a time.

[ME]

Obviously, I have a draw full of jiffy bags and the dog is churning out the truffles should the need arise... :look:

[welsh1]

If you are not going to get paid,take out a county court order,you will then either get paid,or ignored.

If you are ignored then you will have a county court order registered against them.The down side is it takes 23 days.

 

THEN YOU CONTACT THESE PEOPLE

http://www.thesheriffsoffice.com/

 

They have the best recovery rate in the business,and act under Writs from the high court,they are not bailiffs or debt collectors.

 

We want to recover your money for you :look:

[al4x]

yep and if you get a CCJ and they have no money you still don't get any and have lashed out on court fees,

 

Basically once you have a ccj against them and they don't pay its pretty much worth walking away from it in my experience. They usually wait for them to pile up and go bust and the liquidators are the only one to make any money out of them. Debt collectors do nothing you can't do yourself and take money from you

[manxman2]

The above post just about sums it up.

 

see if the debt collectors will work on a no collect no fee basis, not a chance of that happening, so that should tell you all you need to know about the debt collectors confidence.

[welsh1]

yep and if you get a CCJ and they have no money you still don't get any and have lashed out on court fees,

 

Basically once you have a ccj against them and they don't pay its pretty much worth walking away from it in my experience. They usually wait for them to pile up and go bust and the liquidators are the only one to make any money out of them. Debt collectors do nothing you can't do yourself and take money from you

 

This is what i do,just because they have no money it does not mean they have no assets,as i said debt collectors are useless/powerless,county court bailiffs are useless,try a High Court Enforcement Officer (sheriffs officer).

You have to be the quickest,because there will be nothing left if there are a lot of people chasing.

 

 

"Basically once you have a ccj against them and they don't pay its pretty much worth walking away from it in my experience"

 

The ccj is a starting point,be clever get there first.

I personally collect £1000000:00 approx every year,all starting from somebody obtaining a ccj.

[ME]

Lots of experts on this thread. I wonder how many actually run a business and have to make these decisions every day. :look:

 

It isnt a "debt" yet. They are just slow paying as far as you know. What percentage of your monthly income are they as a customer ? Is it easy work or is it a pain in the back side ? Can you afford to unnecessarily lose them as a customer for the sake of a few phone calls and a bit of patience ?

[al4x]

Lots of experts on this thread. I wonder how many actually run a business and have to make these decisions every day. :look:

 

It isnt a "debt" yet. They are just slow paying as far as you know. What percentage of your monthly income are they as a customer ? Is it easy work or is it a pain in the back side ? Can you afford to unnecessarily lose them as a customer for the sake of a few phone calls and a bit of patience ?

 

 

exactly, you can bung a legal letter at them and keep them as a customer if it is a genuine mix up, bung debt collectors in and you'll be lucky. If its a cheque lost in the post I tend to send a driver to pick the next one up and if they won't write it tend to stop the account straight away and start going down the legal route.

 

In your business if its mostly your labour you can take more of a punt on it than if your costs on it are high if you're paying someone else to do it and making 15-20% it hits your pocket if they do go under.

[Mungler]

Indeed.

 

It's not actually a debt until you get a County Court Judgment.

 

If a debt collectors phones and doesn't have a Judgment then he is whistling in the wind. We get legitimate clients pestered for disputed debts by debt collectors - I write them a letter telling them to **** off and get a County Court Judgment and if they make contact again direct then it's harassment and they will be sucking on a injunction.

 

Debt collectors like that work on pester power alone.

 

You then have the choice of throwing more good money after bad to pay a court fee and go to the County Court - you may use a solicitor and incur a cost / fee there. If the lot on the otherside are smart and are just playing for time they will enter a pony defence alleging that you did a poor job / got your numbers wrong / have already been paid or over paid (normally we see companies buying time whilst they re-jig a company to shift the assets out and about before administration and ultimately liquidation).

[Mungler]

Oh, and once you have a "Judgment" what are you going to do with that? It's only a piece of paper. It would cost a minimum of another £2k get the Company Wound Up....

 

And I ask the question again, what would you get once you have wound up an insolvent company?

 

Answer : Nada

 

Send the boys round.

[MC]

Take my advice,

 

I have done this twice, Make yourself a flask of coffee. Walk into their office and sit down. Tell them you will not be leaving until you have been paid.

 

The first time I did it I finally got a cheque at 18:15 and I had been there about three hours. The second time I did it I got the cheque within minutes. These were both seperate companies.

 

I have not had a bad payer since.

[njc110381]

I don't really want to upset them yet because up until now they've been one of the most reliable customers I have, but at the same time I do want to try to find out what's going on in case it goes belly up. I think they're just finding things a bit tight and have just started a new development of around 50 houses so can't be completely under yet. They have assets and lots of them, they're just struggling to sell them and that's where the problems start. The guy is a top bloke and I really don't want to lose him - they're about 1/4 of my work and usually the bills are higher but there hasn't been so much to do recently as most of the major work has been completed. They usually pay me +/- £1k per month (profit).

 

All the money they owe at the moment is labour, about 25% of it has been paid out to my lad and the rest is for my time.

 

If the worst comes to the worst I'll do my best to get my money in the cheapest possible manner, and if not I'll write it off and start sending balloons full of NTTFs horse hoof bait in well taped cardboard boxes to their office. The look on their faces when they key the tape open will be priceless! :look:

[MC]

I don't really want to upset them yet because up until now they've been one of the most reliable customers I have, but at the same time I do want to try to find out what's going on in case it goes belly up. I think they're just finding things a bit tight and have just started a new development of around 50 houses so can't be completely under yet. They have assets and lots of them, they're just struggling to sell them and that's where the problems start. The guy is a top bloke and I really don't want to lose him - they're about 1/4 of my work and usually the bills are higher but there hasn't been so much to do recently as most of the major work has been completed. They usually pay me +/- £1k per month (profit).

 

All the money they owe at the moment is labour, about 25% of it has been paid out to my lad and the rest is for my time.

 

If the worst comes to the worst I'll do my best to get my money in the cheapest possible manner, and if not I'll write it off and start sending balloons full of NTTFs horse hoof bait in well taped cardboard boxes to their office. The look on their faces when they key the tape open will be priceless! :look:

 

 

We can all work for nothing, but that doesn't pay the mortgage does it?

 

Personally I wouldn't be bothered in the slightest about upsetting them, they aren't bothered about upsetting you. Why should you be subsidising their new project? Are they going to weigh you out some of the profits?

 

Don't do anything illegal, just go and sit in their office. Go about 3pm and demand your money. Tell them you are not leaving until you get paid. Also if you can park your car blocking their entrance without causing an obstruction to other companies etc all the better.

 

If you have the slightest inkling that they might be going under get in there straight away and get your money. Leave it too long and they go pop you get nothing.

[Devon Fox]

I think I would arrange to meet the chap, lay it on the line & tell them all you want is honesty and perhaps come to some kind of arrangement - take 50% now and the rest at an agreed time?

 

Its not nice and I hope you get what you are owed - but I would definitely try the nice approach first.