Debt collection with B2C

[Hoofy]

Any opinions on this?

Value is £150 for a service. No complaints about the service but very occasionally, a client goes quiet before paying with no indication that they won't pay. Most clients are happy to pay after I've provided the service. Some clients pay before.

Only concern is negative feedback as people can be a bit illogical and bhy outside their professional lives.

We're talking maybe 1 in 20 clients.

Thanks.

[Simpo Two]

Is this an actual debt or a theoretical one?

[Eleven]

Hoofy said:

Any opinions on this?

Value is £150 for a service. No complaints about the service but very occasionally, a client goes quiet before paying with no indication that they won't pay. Most clients are happy to pay after I've provided the service. Some clients pay before.

Only concern is negative feedback as people can be a bit illogical and bhy outside their professional lives.

We're talking maybe 1 in 20 clients.

Thanks.

Is it the ones who don't like you insisting that they use a condom?

[Cyberprog]

First step would be a notice before action - giving them 14 days to make a payment before which you will take action. Then Using the moneyclaim.gov.uk service start a small claims action which will cost you £25 (added to the debt). Most I would imagine will pay up at this point, either way, they then have 14 days to file a defence or acknowledge service (which then gives a further 14 days) so within 19 or 33 days you will have either payment, a defence, or a judgement by defualt. Then file for a warrant and bailiffs, or things go to mediation (if both parties agree) and then a court hearing. Assuming things are clear cut, you can prove what you say, you win, get a judgement. Then they either pay or you move for a warrant and bailiffs.

[Hoofy]

Simpo Two said:

Is this an actual debt or a theoretical one?

Have I used the wrong terminology?

About 5 customers owe on average £150 each. Not responding to emails etc.

[Hoofy]

Cyberprog said:

First step would be a notice before action - giving them 14 days to make a payment before which you will take action. Then Using the moneyclaim.gov.uk service start a small claims action which will cost you £25 (added to the debt). Most I would imagine will pay up at this point, either way, they then have 14 days to file a defence or acknowledge service (which then gives a further 14 days) so within 19 or 33 days you will have either payment, a defence, or a judgement by defualt. Then file for a warrant and bailiffs, or things go to mediation (if both parties agree) and then a court hearing. Assuming things are clear cut, you can prove what you say, you win, get a judgement. Then they either pay or you move for a warrant and bailiffs.

Thanks for describing the steps. In terms of proof, usually it is just an invoice - no contract is signed (typically with a small deposit being paid). Is this enough or are things dead in the water?

[Hoofy]

Eleven said:

Hoofy said:

Any opinions on this?

Value is £150 for a service. No complaints about the service but very occasionally, a client goes quiet before paying with no indication that they won't pay. Most clients are happy to pay after I've provided the service. Some clients pay before.

Only concern is negative feedback as people can be a bit illogical and bhy outside their professional lives.

We're talking maybe 1 in 20 clients.

Thanks.

Is it the ones who don't like you insisting that they use a condom?

I've told you: no means no.

[Simpo Two]

Hoofy said:

Thanks for describing the steps. In terms of proof, usually it is just an invoice - no contract is signed (typically with a small deposit being paid). Is this enough or are things dead in the water?

You'd send in your claim with all relevant evidence - the quote, invoice, e-mails, reminder letters.

I doubt they'd go to court for £150 but might file a defence, eg 'I didn't pay him because the work was badly done/not finished'. And they would have to prove it. If they defend, you'll rack up a hearing fee (added to claim) then you go to court. They probably won't turn up; you win the case, then decide if it's worth pursuing the money - which is a story for another day.

[Hoofy]

Simpo Two said:

You'd send in your claim with all relevant evidence - the quote, invoice, e-mails, reminder letters.

I doubt they'd go to court for £150 but might file a defence, eg 'I didn't pay him because the work was badly done/not finished'. And they would have to prove it. If they defend, you'll rack up a hearing fee (added to claim) then you go to court. They probably won't turn up; you win the case, then decide if it's worth pursuing the money - which is a story for another day.

Cheers. Feedback at the time is usually fine.

[Cyberprog]

Hoofy said:

Thanks for describing the steps. In terms of proof, usually it is just an invoice - no contract is signed (typically with a small deposit being paid). Is this enough or are things dead in the water?

Well, first of all you need to get your paperwork in order - if you're not getting contracts signed (and check out the cooling off period legislation as well BTW for doorstep sales) then you'll run into a world of hurt later on.

Look at your business processes;

Quotation - with a form for acceptance of quotation with terms & conditions etc.
--Relevant cooling off period before work commences--
Work occurs - at finish, get customer to sign off on job sheet stating that work has been done to their satisfaction etc.
Invoice Customer (preferably do this at time of Work and collect payment upfront for B2C)

Then begins the debt recovery process;

NBA - 14 Days to respond
Small Claims Action
Judgement
Bailiffs to recover (If over £600 then send to high court for writ of fi-fa and then get private bailiffs involved - they are much more effective!)

What do you have for this customer? Emails regarding the work commencing, quotation? or just an Invoice?

[Simpo Two]

On business practice, could you reasonably ask for a 50% deposit? (deposit sounds better than 'payment up front'). At least then if it goes bad you've only lost £75 not £150. Or perhaps consider a small discount if they'd like to pay in full in advance.

[Hoofy]

Thanks, guys.

Can vary from phone call to emails in the initial stages but always an invoice is emailed.

Think the 50% thing is a better approach. I am a bit nervous of legal proceedings as someone can just post up a negative review as a result, even if they're in the wrong.

[Cyberprog]

Hoofy said:

Thanks, guys.

Can vary from phone call to emails in the initial stages but always an invoice is emailed.

Think the 50% thing is a better approach. I am a bit nervous of legal proceedings as someone can just post up a negative review as a result, even if they're in the wrong.

If you're afraid of a negative review, you might as well write the money off!

I'd try and ensure that at a bare minimum you get them to sign off on the quotation, and the work when complete. That means if you do wind up down the legal route you can produce a signed agreement that the job was going to cost x, that the work was done as per agreed and to the customers satisfaction. It makes things a good deal harder for them to wriggle later.

[Cyberprog]

I'd also look at getting a deposit upfront and then balance 24-72hrs before work commences (perhaps with 10% on completion). That may help your cashflow situation also.

[Hoofy]

Cheers. I am pretty much sold on a 50% deposit now.

[Simpo Two]

Well, 49% actually as I'm bagging 1% royalty for the idea

[Hoofy]

Have already posted a cheque.

[Cyberprog]

Hoofy said:

Cheers. I am pretty much sold on a 50% deposit now.

If you have to order materials, you'd be a fool not to!

[Hoofy]

Cyberprog said:

If you have to order materials, you'd be a fool not to!

True. Fortunately, it's largely delivering training etc so no real upfront costs.

[jammy_basturd]

What are your methods to retrieve the money at the moment? I find if I start badgering people everyday they usually get sick of me and pay.