Collect Now, Pay Later
As a freelance designer I’ve been pretty fortunate to have clients who’ve been willing to pay me. Occasionally they have extended their terms by a month or two, but given their general loyalty I’ve been forgiving of those situations. For the first time in 8 years I encountered a client unwilling to pay. What was strange was that it was not the first invoice I had sent to him. He had paid at least two invoices previously. For some reason, he stopped returning my calls and my emails and would not pay for the work I had completed for him. When I called from a different phone number he would answer his phone and claim the check would be in the mail within the week.
After about 6 months I started asking around for advise on how to handle this. Taking the words of wisdom from some other designers this is what I did
Step 1
Send a letter from “Mr. Nice Guy” by certified mail. I politely and graciously sent my client a letter explaining the situation and suggested a couple of ways to resolve the past due payment. In addition I notified him that there would be a 25% late payment penalty if he did not pay within the next 2 weeks.
Result
The letter returned to me “unclaimed”. This meant he refused to sign for the letter.
Step 2
Send a letter from “Mr. Not-So-Nice Guy” by certified mail. In this letter I included a new invoice with the 25% late payment penalty and made it clear that the next step would be to refer the invoice on to a collections agency.
Result
The letter returned to me “unclaimed”. Once again he refused to sign for the letter.
Step 3
I went to freelanceswitch.com and asked for a recommendation for a collections agency in their designer forum. Someone suggested that I contact Diversified Recovery Systems of Mandeville, Louisiana at http://collect-now.com/. He said that he had used them a couple of times with good results.
So I left a message for them and within a day or two got a call back from them. I sent all my invoices and correspondence over to them. I did not have a written contract from my client (and to that point had never requested any of my clients to sign a contract). My sales representative said that they would take a 30% commission and that she would give me a call in a couple of weeks to let me know how it was going.
To my utter surprise within a week they had received payment! I couldn’t believe how efficient and successful they were. My rep let me know that they wait a month to make sure all the checks clear and then they send out payment. “Great! I can wait 4 more weeks” I thought to myself.
Then. . .
4 weeks passed and no check came in the mail. So I called them up and once again my rep explained that they waited a month to send out payment. I thought I might have called early, so I waited three more weeks. Still no payment.
My rep said she’d look into it. 2 weeks later, no payment. I called again. No return call. I called again and was told they’d make payment. 2 weeks later, no payment. I call once more and was told that the Accountant was out of town for Thanksgiving (a week before Thanksgiving) but she was still working remotely and I should receive payment after Thanksgiving. A week passes after Thanksgiving and still no payment. At this point I’m thinking I may need to send a collections agency after my collections agency.
So I called again and was told that if I didn’t have a check by Friday I should call back. 4 days after that Friday I still had not received a check. So I called once more. No return call. I waited 2 days and called again. This time my rep said that she would call me back in 10 minutes. 40 minutes later I still had not received a call back so I left yet another message (I’m seriously shortening this story by leaving out how many messages I left without a return call). Another 30 minutes later I receive a call from my rep saying that she had personally put the check in the mail and I should have it within 4 days.
10 days later . . . I finally got my check!
So I was quite glad to finally get paid. But man, in took a lot of work. I was impressed with DRS’s ability to get money out of my client. But super unimpressed with how long it took me to get paid by them. I so desperately wanted to refer them on after they got my client to pay so quickly. But sadly I can not give them a positive review because it took so long and so much work to get them to pay me.
photo credit: Pioneer Library System
