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Meier
07-17-2003, 10:05 PM
It seems that every month I go through the exact same issue. I bill once a month on the 25th. I give my customers a full month to pay...payment is due on the 24th of the following month.

Here I am with only 6 days worth of mail left between now and the due date and I've only been paid on 50% of the billing I sent out on the 25 of last month. This is totally normal, I'm finding.

I don't care if customers wait until the last minute to pay me. In fact, I haven't been stiffed yet, though I've had to send out some letters threatening to file leins. I just hate the idea of seeing my customer list grow shorter because someone won't pay.

Anyway, it's the same old story every month. Customers wait until the very last minute to pay.

I know many will call me crazy for allowing customers so long to pay. I do assess a 2% late fee if a customer hasn't paid by the due date. My feeling is that if a customer hasn't paid within a full month, after I have done all the work during the previous month, there's just no excuse. I have collected a little in late fees so far this year, but most seem to pay right on the deadline. So far, no one has argued the late fee.

My system seems to be working out ok, I suppose, but I was just wondering if others see the same thing...customers waiting until the last minute to pay?

Later,
DFW, TX

jason r.
07-17-2003, 10:18 PM
Just sent out a cancellation letter last night on a guy who's a constant late payer. Always got my money outta him but I'm sick of waiting on this one check every month. I charge him $200 a cut, so it takes a while to do. Have tried working with the dude about the constant late payments 2 months ago. Last month I got the check in just before the due date. This month his check wasn't recieved by due date (15th) once again so on the 16th I cancelled service. Everybody makes a mistake but when they show no regard for paying the invoices I send out, they will be replaced. From now on, I'll give everyone a second chance but no one a third chance!

scott's turf
07-18-2003, 08:13 AM
If they are two months late and pay the entire bill with late fees I have no problems with them. This month I have made about $100 in late fees. If it is a new customer I will not let them get too far behind without a notification though.

BSDeality
07-18-2003, 07:34 PM
try moving to a net-15 billing period. I think when people see the "hey, i can put this off for a month" net-30 billing they just put it down and forget about it.

GLAN
07-19-2003, 09:10 PM
Do you have a cash flow problem that worries you when it gets to 30 days?

If your collecting a late fee. Your getting money based on the credit allowed by you. Not a bad deal for you.

We accept credit cards for payment. They go beyond 30 days, fine. No worries. 15 days after the first 30 a statement is issued. Not paid, so now it's 60 days. We're still working and an invoice and statement is issued and a phone call. The 60 day late invoice not paid by the 15 another statement is issued with a letter to interupt service if payment not received in 7 days.

Gets that far, service is interupted. Then they usualy pay, but no credit is given for a missed week.

Goes further. We call and repeat the above process. Then after 90 days a registered letter is sent demanding payment. When the registered letter is sent it is also explained that monthly late fees and interest is added within the guidelines of the law.

If we need to. By the end of the season we may have the need to file in small claims court. Though I have only had to go to court once in 27 years.

The interuption of service is when they realize they are being bad ;)

mtdman
07-19-2003, 11:10 PM
Anything more than 1 month past the due date their service gets stopped. I call, I send reminders before that. If necessary, I pay a visit.

But, most of my people are veterans, and I pretty much know when everyone will pay and don't have any really late payers. The same people send the $$ in right away, the same folks send it in at the due date, the same people send it in at the end of the month. I usually get paid by the end of the month 100%. I always put due on the 15th of the month, but legally in Michigan you must give 30 days before charging finance fees. (I found that one out when I tried to charge late fees to a client that happened to be a lawyer!) If you have a cash flow problem, it hurts when you have late payers. Where I'm at now, I don't, so I try to be a bit more flexible with my fees.

Cooper Landscaping
07-20-2003, 01:24 AM
I'm gunna have to go with BSDiality one this one- I would think your best bet would be to change to net 15 as opposed to net 30. this way even your late payers pay by the 24th. In my opinion you would wind up having less of a problem about people forgetting to pay their bills.

-Coop

Meier
07-20-2003, 10:41 AM
++++ would think your best bet would be to change to net 15 as opposed to net 30. this way even your late payers pay by the 24th.++++

I thought about that but decided I wouldn't have the guts to charge the late fee if they were late after only 15 days. With 30 days to pay, I have the guts to charge the late fee. I've been charging and collecting late fees this year, so people aren't complaining.

I wish Quickbooks had a 25 day due date available. All I can choose with Quickbooks is either 15 days, 30 days or due upon receipt. 25 days would be ideal for me.

Later,
osu2winbig12

mtdman
07-20-2003, 09:00 PM
Originally posted by Meier
I wish Quickbooks had a 25 day due date available. All I can choose with Quickbooks is either 15 days, 30 days or due upon receipt. 25 days would be ideal for me.


In my quickbooks you can set the net due to any day of the month. Go to lists, other lists, and click on terms. Then select your terms name, and a box will pop up showing the options. You can set it for any day of the month. Set the due for the 15th, charge late fees after the 30th.

And you need to check the laws in your state. Like I said, in MI you can't charge late fees until after 30 days.

Team Gopher
07-23-2003, 03:18 PM
Something you might consider is this.

Some Gopher users will make separate customer groups. One customer group will be billed mid month, the other group will be billed at the end of the month. Payment terms can be set to anything you'd like, maybe "Upon Receipt." The late fee can then be used as a tool.
If a customer sees that you have a policy on late fees and you implement it, they may pay you faster. You always have the option to waive the late fee if you are paid within a time frame acceptable to you.

A1 Grass
07-23-2003, 06:53 PM
I usually bill customers when I turn off the mower and give them until it's in the trailer to pay!

Cooper Landscaping
07-24-2003, 12:03 AM
A1-
What do you do if its a commercial or if the homeowner isn't home?

-Coop

CamLand
07-24-2003, 01:37 PM
forget that,i wanna see those 2 craftsman 25hp handheld blowers...:dizzy:

A1 Grass
07-24-2003, 07:52 PM
A1-
What do you do if its a commercial or if the homeowner isn't home?

I don't do commercial, and the people I know mail a check which almost always arrives the next day or two. I get paid each time and it works!



forget that,i wanna see those 2 craftsman 25hp handheld blowers...

Duuuuhhh, heh heh.

Come on over. I'll show you.

I love it when people think you have to have a $400 blower, just to BLOW. Mine work great, start right away. Either way, anytime you wanna see them...

ps. Welcome CamLand - the best thing to do on this forum is start jabbing at people you don't know right off the bat! It goes over really well.:dizzy:

CamLand
07-24-2003, 08:27 PM
i'm not jabbing at anybody, i want to see a 25 hp handheld blower.put a picture up.........

mh1314
07-24-2003, 09:58 PM
Whether its being paid for each mowing or by the month, I leave a self-addressed, stamped envelope containing a card that details the services, price and who to make the check out to. It also invites the customer to call for estimates on any additional services they might want.

The envelope takes away from many of the excuses of how much, forgot your address, or didn't have an envelope. It also does away with the time that the bill is in the mail to them and the stamp is used on the return mail and payment.

:blob2:

A1 Grass
07-24-2003, 10:34 PM
Originally posted by CamLand
i'm not jabbing at anybody, i want to see a 25 hp handheld blower.put a picture up.........


:eek:

Here I am, defending my own TYPO! It's me going Duuuuhhhhhh! Thought someone was dissin' my Craftsmans!

25cc NOT 25hp! Notice to all: I can be a little dense sometimes!

Again - Welcome CamLand. You asked for it... Here it is...
The 25hp Blower!

Live4Mowin'
07-24-2003, 11:34 PM
Originally posted by A1 Grass
:eek:

Here I am, defending my own TYPO! It's me going Duuuuhhhhhh! Thought someone was dissin' my Craftsmans!

25cc NOT 25hp! Notice to all: I can be a little dense sometimes!

Again - Welcome CamLand. You asked for it... Here it is...
The 25hp Blower!
Mine looks just like that, its a 25cc, 205mph its just red instead of black and mine has a leaf vac, does yours have one also?

mtdman
07-24-2003, 11:44 PM
I dislike being paid at the time of service. I much rather prefer getting paid at the end of the month, through the mail. I hate having to keep track of everyone's checks all day long, not lose 'em. And I think my customers prefer paying 1 check at the end of the month rather than 4 checks every week. Plus, I always include announcements and special offers, etc, on the backside of the statement I send off. That way I can get important notices off to everyone at once.

But that's just me, and that's how I like to work. I'm sure others have methods that work fine for them too.

:D

A1 Grass
07-25-2003, 12:40 AM
Live4Mowin'-

Yeah, I got the leaf vac also. It works great for flower beds and areas like that.

Snapper (?) sells the same unit and it's red. I got 2 that were returns at Sears (w/new warranty) for $60 each. I like 'em. If they each last one season, it will have made me some ca$h. Someday I'll get that Echo...

GLAN
07-25-2003, 08:44 PM
Originally posted by A1 Grass
:eek:

Here I am, defending my own TYPO! It's me going Duuuuhhhhhh! Thought someone was dissin' my Craftsmans!

25cc NOT 25hp! Notice to all: I can be a little dense sometimes!

Again - Welcome CamLand. You asked for it... Here it is...
The 25hp Blower!


Man I love those pipes!!!
Use chrome polish on'm? :p

Russo
07-26-2003, 09:40 AM
A friend who is a great salesman told me one time that "Acounts Receivable issues are handled at the time of the sale"

This idea changed my perspective. I let new customers know that I'm not their bank right from the get go. Of course, not in those words. Hope this helps.

PS - I also switched to 15 day. Bill on first for whole month work. Due on 15th. I work 2 weeks on credit....they prepay for the next two weeks. It seems fair to my customers as well as myself. Good Luck.

Team Gopher
07-26-2003, 02:16 PM
Here is another option. I was talking with a Gopher user the other day and they explained to me how they did their billing. They have most of their reoccurring service customers on contract and they bill them a month in advance. So the bill that goes out in July is for the service in August.

GLAN
07-26-2003, 06:08 PM
Gopher

I know a company that does that also. In fact all his customers are monthly rate billed 1 month ahead. Any adjustments made at the end of the year.

Not a bad concept. Thought it for myself over the years.

MJ
07-27-2003, 05:16 PM
I'm in the process of hiring a lawn care service and got to thinking about this thread today. I went back and re-read Meier's original post. According to him, payment wasn't even due. Several follow up posts were referring to delinquent accounts. I'd be pretty upset if a creditor just simply expected payment before the due date. I habitually pay early, but that's for my benefit not their's.

I agree with some on here that you should adjust your due date - to net 15 or whatever. But expecting to be paid before to due date is unfair to your customers.

(I don't do any mowing and hate to mow, but I do some snow plowing and the same principles apply)


Mick

MCGRAIL LAWN
07-27-2003, 07:06 PM
I bill NET-15
If they pay late they get moved to NET-10
And then Due On Receipt.

As long as I am receiving money with in a decent amount of time from the billing time I cant comoplain

GLAN
07-27-2003, 07:17 PM
Some home owners don't even think that anything would be due net 30...............Unless on the invoice there some indication...........even that they still don't think that they have to pay the landscape bill in a reasonable time.


I have this one paricular customer. Been servicing him for some 18 years now. Never paid his bill..............I would call, he say stop by for a check............always had the check waiting, on ocasion would mail it.

It's gotten to the point now that for the past 10 years we have added on late fees and interest. I call, he asks how much, he sends the check.

He actualy told me that when my invoices arrive they go in the garbage.

Today all our invoices indicate upon receipt. Snow contracts are written that way as well, with a 15 day net of the date of invoice. This past winter, had a company contracted billed for each storm. Same payment arangement as above. They went 45 days. I called the building maintenance coordinator, informing him that due to nonpayment service will be suspended. Less than a week after that call. We had an 18 inch fall. We did not plow. There was an accident in the parking lot and someone fell and broke their arm. They immediately tried to sue me as a breach of contract.

It never went to court, cause of the signed contract and the indication of the payment schedule. They paid, and thought I would return for the next snow. Well, when I got contacted by their lawyer about being sued the first time I sent the company and the lawyer a letter informing them that we would no longer service their property.

So when it snowed again, I never went to plow, another snow 2 days later, again I did not go. We terminated the contract. This company never got plowed those storms. Couple days later I get a summons to appear in court. Again they are claiming my breach of contract. We counter sued, for lost revenue that would have been generated for the rest of the plowing season. By the time this all went to court. Their claim was thrown out and I got half.

The companies claim was that they only pay on a 90 day cycle. Their lawyer must not have been to smart. My lawyer told me that after reviewing the contracts and their lawyer saying the company only pays on 90 cycles. The judge laughed in his face.