Recently I made a big mistake with a new client. It’s one I used to make a lot when I first started freelancing and I’m sharing my experience hoping that you’ll be able to avoid making the same mistake with your own clients. I compromised one of my business policies even thought I knew in my gut I was making a mistake and of course I paid for it in the end.
It all started when a local company contacted me about doing some freelance writing for them. We spoke over the phone a couple of times, I sent them a proposal and a couple of weeks later they asked me to draw up a contract for the project. Things were going great until we started talking payment terms (big surprise).
My terms require full payment upfront for projects under a certain dollar amount, and a 50% down payment for projects over that rate plus scheduled payments thereafter depending on the duration of the project. Naturally that was going to be a problem for this client because they only invoice monthly. I’ve dealt with mid-size businesses that invoice monthly before and that wasn’t a problem per se. I told him that he could pay the down payment and I’d be happy to invoice the remaining balance at the end of the month. Another problem: since the company invoices monthly, they are unable to make an advance payment (Yes, it just kept getting better).
I honestly didn’t feel comfortable with the arrangement, but stupidly agreed to it anyway. The next day the situation still didn’t sit right with me so I discussed it with my accountability partner. She gave it to me straight with her most charming, lilting, Irish accent saying, “Oh, you shouldn’t have done that. You’ve worked in a corporate environment before. You know as well as I do that if a company needs to cut a check for something important they can do so the same day. You should not compromise your own policies so easily assuming that they wouldn’t want to do business with you." (The Irish are so wise)
I ended up getting paid, but it took much longer than the 30 days outlined in the signed agreement. In the past I’ve offered discounts and made special payment arrangements with returning customers; but it sets a bad precedence to dismiss your own policies too often, too easily or too soon. Policies are put in place for a reason – usually to protect you and your business, and anyone who’s hiring your services will respect that if you insist. Clients will test your resolve, but you don’t have to automatically give in, especially when it’s not in your best interest. That’s just business.
Jennifer Mattern approached a similar issue and discussed it on her blog recently. I agree with her stance on this topic and encourage you to check it out for yourself.