Collecting Money from Customers who are Reluctant to Pay! Any tips?

ronan45

Hi Guys

So I started a back shed tool Repair service (very small) All my customers I have known years. All grand except a few of these long time "Acquaintances" have proven to be a bit underhand.
I was fair and repaired their equipment. We agreed on a VERY reasonable price. (half the cost of the main dealer) Excellent Service. Now When i look for money Im met with "oh Yeah mate I havent had work for it so ya no I cant pay to be honest"
The bill was 200 Euro. I said could you do 50 a week Reply "No" .I was very mannerly on the phone and gave him 4 months to pay. During the 4 months I sent him a text every 2 weeks
"Hi ____ Any joy on that few bob for the repair Regards Ronan"
"_____ I have paid for those parts supplied on my visa months ago any chance you can sort me out for $$"

So i Called him again Yesterday and asked could he pay just 5 Euro a week reply "im Smashed, Jasus you must be desperate if your looking for 5 euro a week mate"
So I was polite and asked maybe sarcasticly why he expected me to pay for his company tools to be repaired. With that I flipped and hung the phone up . Has anyone any tips to get cash in in a fair way and when does one turn from being the nice guy to being just plain blunt and DEMANDING the cash. Does DEMANDING work. Am i being too nice?
In the mean time i have switched to a No cash no machine being returned basis. Explaining I have been Stung too many times.

EIREHotspur

small claims court??

Do they cover such things in the paper?

If so it would be worth doing once so the publicity would put other people off doing you out of money in future.
Cannot stand people who do not pay their bills.

ronan45

EIREHotspur wrote: »

small claims court??

Do they cover such things in the paper?

If so it would be worth doing once so the publicity would put other people off doing you out of money in future.
Cannot stand people who do not pay their bills.

I dont think for 200 quid here and there its worth the courts. What really irritated me is The guy aint skint. If i asked him for 50 cent a week he wouldnt of given it. That attitude really bugged me.

listermint

ronan45 wrote: »

I dont think for 200 quid here and there its worth the courts. What really irritated me is The guy aint skint. If i asked him for 50 cent a week he wouldnt of given it. That attitude really bugged me.

Ronan you need to send him a written invoice for the work. Youve been too nice about it in the past. Also include that you will not do any future work for him until the matter is resolved and that you had given him the best price he will get on the market. Shorting people of cash will not make his life easier in the future.

ronan45

listermint wrote: »

Ronan you need to send him a written invoice for the work. Youve been too nice about it in the past. Also include that you will not do any future work for him until the matter is resolved and that you had given him the best price he will get on the market. Shorting people of cash will not make his life easier in the future.

Hi Lister, I sent him an invoice, a business card, A Stamped self addressed Envelope for ease of posting back cheque all in a registered letter. He signed for it also. The repair I have done unfortunatly will see his equipment last at least another 5 years before he needs me again which he well knows :mad:

Gloomtastic!

You need to get to the top of the list of people he needs to pay.

Do you know where he lives? Call over one evening for a chat and don't leave until you get the money. If not, call into his office and don't leave until you get your money. Don't threaten anything, just stay there.

Become as irritating as his attitude. You won't be doing business with him again so what have you got to lose?

ronan45

Gloomtastic! wrote: »

You need to get to the top of the list of people he needs to pay.

Do you know where he lives? Call over one evening for a chat and don't leave until you get the money. If not, call into his office and don't leave until you get your money. Don't threaten anything, just stay there.

Become as irritating as his attitude. You won't be doing business with him again so what have you got to lose?

He hasnt got an office per say. He actually is on the far side of the country (back end of no-where, I happened to be up there a few weeks ago and called him while there to discuss but No answer. Left voice mail. Got a text to say he had put his back out and was unable to meet. Ill Ring him again next week. I just think if i become rude thats the PERFECT excuse for him to say ok NOT PAYING

ronan45

Would it be a bit Pathetic to ask for the Spare parts supplied back? They are not to difficult to remove and made up the bulk of the cost of the transaction

Bandara

Small Claims court is not a possibility here

Bandara

ronan45 wrote: »

Would it be a bit Pathetic to ask for the Spare parts supplied back? They are not to difficult to remove and made up the bulk of the cost of the transaction

What's pathetic is his attitude/behaviour.

You do whatever you have to do, don't worry what it looks like, your not the one who created this situation.

Good luck with it.

howamidifferent

ronan45 wrote: »

Would it be a bit Pathetic to ask for the Spare parts supplied back? They are not to difficult to remove and made up the bulk of the cost of the transaction

Perfectly reasonable request in my opinion. :mad:
If as he says, he's not gotten any work for the equipment then he cant say he needs it. You are willing to absorb the time and labour spent on the repair, in return for getting the spare/refurbished parts back which will allow you to at least possibly sell that repair to someone else in the future. He gets to not pay, you lose money on service, but he is left in the wilderness in the future. :cool:

Maybe next time you call to his premises you arrive to "repair" the unit but remove your spare parts. Maybe if your lucky, you could ring him in advance to give him a chance to avoid you with his bad back...he wont be there to interupt your "repair" then.

HellFireClub

Very simple solution OP, from someone who once had the same problem. Don't give them credit in the first place!

And another lesson I learnt from the University of Life, "DON'T DO ANY WORK FOR MEAN C*NTS"!!!

ronan45

HellFireClub wrote: »

Very simple solution OP, from someone who once had the same problem. Don't give them credit in the first place!

And another lesson I learnt from the University of Life, "DON'T DO ANY WORK FOR MEAN C*NTS"!!!

Lesson Learned Hellfire. I give nothing on credit now. I noticed any time i give credit now theres an excuse so i put a blanket ban on it. The gas thing is these guys are i mean WERE sound before hand but when they spotted an easy kill they changed.

tricky D

ronan45 wrote: »

Would it be a bit Pathetic to ask for the Spare parts supplied back? They are not to difficult to remove and made up the bulk of the cost of the transaction

While not the same scenario, a friend of mine supplies heating oil and specifies that he owns it until it is paid for within the given period. He has emptied tanks a few times to get the message across which always has worked.

Hammertime wrote: »

Small Claims court is not a possibility here

€15 to get €200 back, though time (money might be wasted). The threat might be enough though.

Pixelcraft

tricky D wrote: »

€15 to get €200 back, though time (money might be wasted). The threat might be enough though.

Small claims won't enforce debts.

tfortony

Your after bein made to look a fool paying and repairing peoples stuff,Did you not ask for money before you gave him the device back?or when you order the parts?Grow a set and knock on his door and demand the money
or you a man or a mouse??

So I started a back shed tool Repair service (very small) All my customers I have known years. All grand except a few of these long time "Acquaintances" have proven to be a bit underhand.
I was fair and repaired their equipment. We agreed on a VERY reasonable price. (half the cost of the main dealer) Excellent Service. Now When i look for money Im met with "oh Yeah mate I havent had work for it so ya no I cant pay to be honest"
The bill was 200 Euro. I said could you do 50 a week Reply "No" .I was very mannerly on the phone and gave him 4 months to pay. During the 4 months I sent him a text every 2 weeks
"Hi ____ Any joy on that few bob for the repair Regards Ronan"
"_____ I have paid for those parts supplied on my visa months ago any chance you can sort me out for $$"

So i Called him again Yesterday and asked could he pay just 5 Euro a week reply "im Smashed, Jasus you must be desperate if your looking for 5 euro a week mate"
So I was polite and asked maybe sarcasticly why he expected me to pay for his company tools to be repaired. With that I flipped and hung the phone up . Has anyone any tips to get cash in in a fair way and when does one turn from being the nice guy to being just plain blunt and DEMANDING the cash. Does DEMANDING work. Am i being too nice?
In the mean time i have switched to a No cash no machine being returned basis. Explaining I have been Stung too many times.[/QUOTE]

tricky D

Pixelcraft wrote: »

Small claims won't enforce debts.

Dead right, mea culpa. And I knew that already. I'll blame a good holiday for making me forget.:)

The Guvnor

At this stage would I be correct in assuming this is a matter of principle?

To me it looks like you could end up spending more than €200 to recoup the €200 not withstanding the time involved.

antoinolachtnai

Well, first thing is that there is no point in falling out with people. If he wants to bring in other stuff in the future to you, why not repair it? Just insist on cash up-front and try to get some of the old money back.

If other people have treated you well as regards credit, why not allow it for them? You do have to regulate and manage it carefully. But there is no point in cutting the facility off for everybody just because some muppet stiffed you for a few hundred euros.

Credit is just a service a business offers, it has a cost the same as any other facility or service. If people don't use it, you should give them a discount. If you don't want to offer the facility, fair enough, but no customer wants to hear your sad story about having been stung.

You need to talk to your accountant about credit policies.

Legally speaking, retention of title on parts is a good idea, i.e., you own the parts until they are paid for and you can come and take them back. Look on the back of the invoices from your suppliers and you will see this type of condition. There are some legal ins and outs on this. (The example above of taking back oil from a customer is extremely problematic from a legal point of view, for example.)

What is the point of going in there and demanding money? You don't have any leverage to use against him. Are you going to go to court? Are you prepared to get a judgement against him? Are you in a position to take back the parts? Is there anybody else you can go to to try to get your money back?

You have to be careful not to waste more time and energy on this than it is actually worth. I would write frequent letters to him if I were you. Might not get you your result, but at least you won't waste too much time at it.

There are not that many people about to repair tools and machinery well. It might seem like there are, but there actually aren't. It's a small enough community. He will probably be back in some form, or get his comeuppance one way or another. Don't be surprised if you get a call from a competitor asking about him some day when he goes to get the tool repaired there. And don't lose any more sleep over it.

ArtSmart

sheesh. sounds like it's become personal OP. forget it. completely. move on. lesson learnt, end of. otherwise it owns you.

mlumley

In future when you give anyone a bill, have printed on it that any parts supplied remain your property untill the full amount is paid. Then you can take the parts back, they are yours. Also, have a sign in your shead stating that goods will not be released untill bill is paid in full. You can explain to others that you have been shafted in the past and are only protecting yourself.

I once worked for a tarmacker who put this on the bill, he wasnt a traveller just an honest worker, and threatened to remove the tarmac from the mans drive if he didnt pay up. He had four workers standing there ready with tools, he soon payed up.

antoinolachtnai

The thing with the tarmac and diesel is a nice thing to threaten and may work well in practice, but it is unlikely to work well if you ended up in court. See http://www.lawdit.co.uk/reading_room/room/view_article.asp?name=../articles/9021-Retention-of-title-clauses.htm .

You also need to write in the right to seize your goods back. You need to consider if you would need legal advice on this.

EIREHotspur

antoinolachtnai wrote: »

Well, first thing is that there is no point in falling out with people. If he wants to bring in other stuff in the future to you, why not repair it? Just insist on cash up-front and try to get some of the old money back.

No point in falling out with people?
If he brings other stuff in the future he should repair it?
Are you having a laugh?

Thats a very naive attitude in todays harsh world.

He has stuck the proverbial two fingers up at him over payment, given him the run around and sorry to be blunt but he has made a fool of him.

This guy would not be coming back to me if I had to ask him twice for payment.

antoinolachtnai

It's not about 'the two fingers' or 'being made a fool of' or your status in society or anything else. It's about business, if you are running the enterprise as a business. Business is either worth taking or it is not.

The country is full of customers who because they have made a mess of their credit for good or bad reasons, can only do business on a cash basis. It happened before, and now it has happened again. That is how it is.

It may not really be a business. It may be a lifestyle, in which case, you can let your personal feelings drive the choices. There is nothing wrong with this, but it is very different from running a business. If you consider it as a business, with the objective of maximizing profit, you sometimes have to put your feelings aside.

TheCostumeShop.ie: Ronan

This is a common situation in some sectors. People often won't pay their credit accounts or for service till they next require your services.

The truth is they are probably right money is tight and your bill has become less important and urgent than others to them. As unpopular as I'll be for saying this, it is most likely partially your fault. You can be sure they can find the money to pay for petrol to drive to their next job as its urgent and must be paid upfront.

I would suggest the following:

1. Change your pricing structure. No need to re-invent the wheel just borrow the model from motor garage. You should charge for the "service" ie. €XX to look at their equipment if it requires replacement parts call them to confirm the price to have it mended (parts and labour).

2. When they show up to collect the equipment get their payment before they get their equipment. While they don't have the equipment your service is valued, urgent and important. Once they have it back and are using it, well its less so.

3. Don't burn your bridges with the customers who burned you, quit chasing them hard as its a waste of your focus. Make it known that they are welcome to come back to you in the future if you still want their business that is (I think you should want it), even send them a newsletter with a non transferable discount for next purchase to win them back.

4. If they do come back, have a look at their equipment as normal call them to explain if there is need to parts and labour, explain that their total outstanding account balance will due if they would like the equipment fixed. At this time your back to being high value and if you are still cheaper than the other dealer, then it's a win win.

All this starting fights legal or otherwise over 200 bills really isn't worth it.

EIREHotspur

antoinolachtnai wrote: »

It's not about 'the two fingers' or 'being made a fool of' or your status in society or anything else. It's about business, if you are running the enterprise as a business. Business is either worth taking or it is not.

The country is full of customers who because they have made a mess of their credit for good or bad reasons, can only do business on a cash basis. It happened before, and now it has happened again. That is how it is.

It may not really be a business. It may be a lifestyle, in which case, you can let your personal feelings drive the choices. There is nothing wrong with this, but it is very different from running a business. If you consider it as a business, with the objective of maximizing profit, you sometimes have to put your feelings aside.

Well I like to cut through the cr@p.

To me Business is also about your good word.
You deal with people no matter what header it calls itself.

I never mentioned status....thats a personality trait for yuppies.

If you offer a genuine good service and price to your skills then you expect to get paid for it.
Where does it say in Business that you market for people who have no intention of paying you? Thats a fantastic business model.

You won't maximise profits by dealing with people that don't pay you.

By the way....the old Business is Business quote is nonsense because nobody leaves their feelings aside as a customer.

TheCostumeShop.ie: Ronan

EIREHotspur wrote: »

By the way....the old Business is Business quote is nonsense because nobody leaves their feelings aside as a customer.

Emotions have absolutely no place in business unless your that's what your selling.

OP created a situation where customers were likely to let him down and they did. It's just the cost of learning a lessen. We all pay these dues from time to time. If amazon offered to send out goods and customers could pay them if and when they felt like it, they would have experienced the same human behavior.

EIREHotspur

Ronan......Emotions have no place in Business?......what do you think the best marketing is based on?

The best Marketing Man died a few days ago.

Steve Jobs wasn't the great Technical Genius people made him out to be...he got his start because he was friends with Steve Wozniak who was the real tech genius behind the startup of Apple. He was however a Marketing Genius who played to his strengths and let Wozniak do his thing.

The Ipod wasn't the best featured Mp3 Player when it came out.....the Creative Labs one was.....many more features and file types could be played on it.
the iPod sold more because of the clever marketing.

Jobs advertising went along the line of "You need this device....everyone else will have one so don't be left behind".

Anyway I agree with you that he made a rod for his back but I hope he erases that guys number and learns from this.

TheCostumeShop.ie: Ronan

Marketing can use emotive signals and this is because many customers are emotive led. Jobs sold solutions 1000 songs in your pocket vs's 5gb.

My point is you shouldn't run a business based on emotions, keeping things facts based and analytic is preferable. People who let their emotions run their business, struggle much more than those who can separate the two in my experience.

If he doens't "like" the guy, he can insist the packages are delivered or cut down on face time. But as a business person he should be looking to service all customers in his field as long as they are profitable. Now if the customer is time consuming or hassle in the future there is no harm firing that customer. But i'd certainly be giving a second chance since he allowed the conflict to arise and by his own statements the guy was "sound" before hand, just hard to get money from.

EIREHotspur

I strongly dissagree with that opinion.

Passion is an emotion.
People who are passionate in what they do succeed far more than people who are not.

Somebody who owes you money and has given you the run around for weeks ignoring you at every turn.....they are no second chance people. But to each their own.