Absolutely astonished!
Discussion
Hi all, just thought i'd share a story with you - i'm absolutely lost for words!
For the past 3 years or so i've been running a small one-man consultancy company and have had a small number of clients, some of which I work with on a contractor basis - e.g. developing code sat in the corner of the office.
This particular client I worked for last year for about 6 months and invoiced them at the end of each month. My terms are 14 days and only on one occasion were they late (by about 3 weeks).
I went back to work for them recently for approx. 6 weeks. Two in May, and another 4 in June. At the end of June I was planning to issue a single invoice, but at their request issued two - one for May, one for June. I dated them a few days apart - one at the end of June, the other 1st July IIRC.
Both invoices became due in the middle of July. I've been chasing them and their position is this:
1. They have a new payment system which means they settle invoices 30 days after the month end of the invoice date.
2. This means I will receive payment for May in the first few days of August.
3. I will receive payment for June in the first few days of September.
I know one of the directors personally and she is supporting this position.
To me, I can understand their desire to standardise their payment process, but jeez .. i'm working with 3 ex/contractors right now and although they work/ed through an agency, they were paid weekly or bi-weekly!!
I can't believe how some companies treat you, despite having worked very closely with them and also knowing the director on a personal level. They are simply treating me like any other supplier - e.g. stationery, water, computer supplies. Of course it's a completely different kettle of fish for me personally, because for that period they were my only client - 100% of my time was dedicated to them!
I'm gonna charge them interest, btw. Not much more I can do. Just really lost for words!
For the past 3 years or so i've been running a small one-man consultancy company and have had a small number of clients, some of which I work with on a contractor basis - e.g. developing code sat in the corner of the office.
This particular client I worked for last year for about 6 months and invoiced them at the end of each month. My terms are 14 days and only on one occasion were they late (by about 3 weeks).
I went back to work for them recently for approx. 6 weeks. Two in May, and another 4 in June. At the end of June I was planning to issue a single invoice, but at their request issued two - one for May, one for June. I dated them a few days apart - one at the end of June, the other 1st July IIRC.
Both invoices became due in the middle of July. I've been chasing them and their position is this:
1. They have a new payment system which means they settle invoices 30 days after the month end of the invoice date.
2. This means I will receive payment for May in the first few days of August.
3. I will receive payment for June in the first few days of September.
I know one of the directors personally and she is supporting this position.
To me, I can understand their desire to standardise their payment process, but jeez .. i'm working with 3 ex/contractors right now and although they work/ed through an agency, they were paid weekly or bi-weekly!!
I can't believe how some companies treat you, despite having worked very closely with them and also knowing the director on a personal level. They are simply treating me like any other supplier - e.g. stationery, water, computer supplies. Of course it's a completely different kettle of fish for me personally, because for that period they were my only client - 100% of my time was dedicated to them!
I'm gonna charge them interest, btw. Not much more I can do. Just really lost for words!
Eric Mc said:
To be fair, why shouldn't they treat you the same as other suppliers?
Of course, it's up to them how they treat me - it's a bit like people who say "she treats me like X" or "don't talk to me like that". In actual fact, they can treat me however they like - theres nothing I can do about it. I'm just flabbergasted that they CHOOSE to treat me like this. It just stinks. And I can't believe that on a personal level these guys feel comfortable doing this. Are they really saying that they don't want my help in the future. Cos that's how it looks to me - it's like a big neon sign!
Tyre Smoke said:
ettore said:
you`re very lucky if this is the first time that this has happened to you!
Too right!
futie said:
Eric Mc said:
To be fair, why shouldn't they treat you the same as other suppliers?
Of course, it's up to them how they treat me - it's a bit like people who say "she treats me like X" or "don't talk to me like that". In actual fact, they can treat me however they like - theres nothing I can do about it. I'm just flabbergasted that they CHOOSE to treat me like this. It just stinks. And I can't believe that on a personal level these guys feel comfortable doing this. Are they really saying that they don't want my help in the future. Cos that's how it looks to me - it's like a big neon sign!
The big banks all have new systems which pay at the end of the month following the month of invoice. A bit mean, but if you have a written contract then it should state payment terms and the fact that you get interest.
Incidentally, if you DON'T have a written contract which assigns IP to them, YOU OWN what you have written........ Just a thought
Refered to as 30 days net monthly. Its a common practice. However if you have done work for them before and they have not informed you of their change in trading practices then they should pay you on terms stated on your invoice. Did they send you a purchase order? did that purchase order have their terms stated on it? If not then your are within your rights to enforce the terms on your invoice and indeed charge them intrest.
Hmm, has happened to me before too. Simple advice: treat them as they treat you.
If it were me I'd be considering:
1. Change payment terms to not give them 14 days - payment should be due immediately on invoice.
2. Invoice immediately on completion of work (i.e. have them ready to give out the day you leave).
3. Putting up my rate to 'cover the financial implications of the change in client policies'.
This should put you back on an even footing. In reality, I'd probably avoid 3 unless they started to be really awkward.
Edit to add: If you were ever at any risk of being under IR35 then this should help put you in the clear at least so it may not be an entirely bad thing.
If it were me I'd be considering:
1. Change payment terms to not give them 14 days - payment should be due immediately on invoice.
2. Invoice immediately on completion of work (i.e. have them ready to give out the day you leave).
3. Putting up my rate to 'cover the financial implications of the change in client policies'.
This should put you back on an even footing. In reality, I'd probably avoid 3 unless they started to be really awkward.
Edit to add: If you were ever at any risk of being under IR35 then this should help put you in the clear at least so it may not be an entirely bad thing.
Edited by Jared_m on Thursday 27th July 18:31
I would worry if they weren't a big company who have reasons for having this system. Deferring debts can be a feature of the industry: we can't pay you until we are paid as the amounts or the lead time are large (e.g. large metal trades), or 'we are going bust and know it'. My invoices used to say 28 days, but frankly that counts for nowt without proper terms and conditions signed up as I understand.
In reality, this kind of crap happens all the time, and for what very, very little it is worth in practice, I imagine they are in breach of contract with you. I assume you have a contractual relationship with them ... even if nothing is in writing, it is hard not to be ... and that ought to establish the terms of payment. They can't unilateraly redefine the payment terms, unless your contract with them allows them to (which would seem rather unlikely).
www.debtrecovery.tv our unofficial logo is "we don't f*ck about"
Futie unless I'm missing something an invoice dated May and paid "30 days after the month end of invoice date" would mean ( hopefully) receiving payment end of June/ early July, not August as you state in your first post? It never fails to amaze me how companies completely disregard their suppliers payment terms and have there own ones! After 18 years of having my own company it still winds me up.
Fer said:
..also up to you if you chose to let them treat you like this again.
Agreed! plasticpig said:
Did they send you a purchase order?
Nope, the arrangement was very casual - as I said, I know one of the directors personally, and of course i've worked for them before. Only paperwork were my invoices which clearly stated 14 day terms. Jared_m said:
.. lots of useful stuff ..
Yep, if they want me back they'll find a bloated daily rate and 50% payment up front required. But their current attitude is astonishment at my complaints, so I don't expect i'll be going back .. david_s said:
30 days nett monthly would be a luxury! We are still waiting abaout £5k from before April and £20k from May.
Snap! I'm owed 10K from April this year too .. but as I said, those guys were actually honest about their situation and have given me a payment date of end Aug. I've also loaded this up with interest (£400 or so). jamesuk28 said:
www.debtrecovery.tv our unofficial logo is "we don't f*ck about"
Very useful - thanks for the link. sjc said:
Futie unless I'm missing something an invoice dated May and paid "30 days after the month end of invoice date" would mean ( hopefully) receiving payment end of June/ early July, not August as you state in your first post? It never fails to amaze me how companies completely disregard their suppliers payment terms and have there own ones! After 18 years of having my own company it still winds me up.
The two invoices were dated end of June and first of July for work done in May & June. By their terms they are paying 'correctly' which is probably why they fail to understand why I have a problem! Edited by futie on Friday 28th July 00:48
On that basis, what they are doing is standard practise for most companies. The relevance to them is the invoice date, not when the work was carried out. If I'm thinking a job may overrun into the next month I always back date the invoice, sometimes it gets picked up, but more often than not it helps!
This is just normal practice. You don't 'work for them' you are a supplier. These are average payment terms for a large company to another company. If it causes you any problems I would factor this into your charges when you next agree to do a piece of work for them, otherwise perhaps find another client with better payment terms.
I am sorry that may not be what you want to hear but I have had many clients that could not manage to pay an invoice in 50 days let alone 30, so things are not really that bad - are they?
Sam
I am sorry that may not be what you want to hear but I have had many clients that could not manage to pay an invoice in 50 days let alone 30, so things are not really that bad - are they?
Sam
I have to say I am not at all surprised. There are various companies my fathers company has dealt with where the standard practise was to delay payment as long as physically possible without debt recovery becoming involved. Why? Money in their bank is better than yours and if they owe you enough you might go to the wall before they have to pay and then it'll be even longer before the liquidators get their act together and come after you for the money.
As you said, charge them interest, express your displeasure and try and figure out a plan of action for next time. Its becoming all to common practise these days. Business is no longer about mutual respect and strong partnerships being beneficial for both parties, its just about being the last dog breathing in the cage and too bad if you maul your own pups.
As you said, charge them interest, express your displeasure and try and figure out a plan of action for next time. Its becoming all to common practise these days. Business is no longer about mutual respect and strong partnerships being beneficial for both parties, its just about being the last dog breathing in the cage and too bad if you maul your own pups.
Gassing Station | Business | Top of Page | What's New | My Stuff