Help Collecting Overdue Account

[rvbsystems]

I need advice on collecting money from a client. The customer is a small business (20 employees) located in Los Angeles. They have owed my company over $800 since Feb 2007. I have sent multiple overdue notices and e-mails. I have tried to speak with one of the principles on the telephone, but keep getting voice mail (of course no return calls). What's the next step? Collection agency? Small claims court? other?

[Logan]

Do you know who at the company writes the checks, and have you talked to them. That is where I would start, there is a person somewhere and identifying who that person (that actually writes/signs the checks is key). I would talk to them and explain your situation - then ask what steps you or they can take to resolve the problem. Get specifics, ask when/dates and even request them to provide you the check number that they are sending.

Its such a small amount, I would try to solve it yourself without being adversial with the courts.

[Shellyshem]

The account is 90 days old now but likey just over 60 days past due. I would do as Logan suggested and try and talk to the person who writes the checks and/or holds the purse strings. This often clears up the situation.

If they still do not pay and the account goes over 90 days past due, send a certified letter to the person you have determined is in charge (the owner, director, what have you...). Tell them they have 10 business days to bring the account current or you will proceed to file against them in small claims court for all money due plus the filing fee. Be as nice but as firm as possible when you do this.

90% of companies will pay when faced with the possibility of court. Those that don't, you're probably not going to get a dime from even if you win in court.

Being nice but firm will go a long way. I've had two consistent problem payers and I have not lost the business of either one even though they've received these letters. I've not had to bring action against them either.

[blueivy]

Originally Posted by rvbsystems

I need advice on collecting money from a client. The customer is a small business (20 employees) located in Los Angeles. They have owed my company over $800 since Feb 2007. I have sent multiple overdue notices and e-mails. I have tried to speak with one of the principles on the telephone, but keep getting voice mail (of course no return calls). What's the next step? Collection agency? Small claims court? other?

Hi,

I've had to do this once over here in the UK. I did contact the customer several times. I even spoke to him once on the phone and he promised to send it. Nothing.

I went to a collection agency and the money was paid up. It cost me £5 (about $10). The money owed to me was around £70 (about $130) and I never worked for that client again.

I have by no means a plethora of clients that I can afford to throw away, however I make it a point to no work with clients who don't have the decency and respect for me to pay up on time. We all make mistakes. We all slip up. And we all forget to pay bills. However, 60 days overdue is not a mistake, a slip up or somebody forgetting (especially when you're calling them).

It's time to stop you stressing about it and put it in the hands of somebody else - the collection agency. It's also time, in my opinion, to dump that customer if you can.

Just my two pennies worth.

[rvbsystems]

Thanks for all of the advice. The account is actually 120 days overdue. I have only had to write off one account in 10 years of business. I hope that this one is not number 2.

[Corey Bryant]

Did you send them a registered letter? You might consider paying an attorney to write the letter as well. Hopefully your terms also allow you to add those fees to your expenses.

A lot of times, just a letter from attorney will do. But since they are in Los Angeles, Judge Judy comes to mind

[rvbsystems]

I'm thinking more along the lines of Bruno than Judge Judy.

[Peter Bowen]

There are some devils who will take advantage of anything they can. These people do not deserve our time and attention.

Hand it over straight away to a collector (not Ugly Mike and his suit-clad baseball team) who will take payment only on results.

Then, with that out of the way focus on making money - or' you'll have ugly mike visiting you

Cheers

pete

[rvbsystems]

FYI - I decided to give this guy one final call before contacting a collection agency. HE PAID WITH A CREDIT CARD OVER THE PHONE!

Thanks for all the advice.

[Corey Bryant]

Congratulations! (Next time, fax a request over though in case he calls and does a chargeback.)