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  #11  
Old 06-03-2014, 09:54 PM
Dr. Cornwallis Dr. Cornwallis is offline
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Join Date: Oct 2013
Location: Valrico, Fl
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Quote:
Originally Posted by FLC2000 View Post
I do plenty of commercial. They pay me fairly quick. Like within 20 days quick. Ive never had to chase any of them.

The people that I struggle with are mid 30 to early 50s that live in half million dollar homes and drive BMW's...

The people that ALWAYS pay me on time are older and usually retirees.
Same here. My elderly and lower income clients are better at paying on time than my upper middle income clients.
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  #12  
Old 06-03-2014, 09:54 PM
FLC2000 FLC2000 is offline
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Location: Shawnee Kansas
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Quote:
Originally Posted by Dr. Cornwallis View Post
I think it's part of the business. I have a friend that I mow for who is consistently late, every month. I've gotten where I know that I'm going to have to shake him down for money, however, his account is very profitable, he's always having extras done like mulch and landscape work. That combined with the fact that he's a friend I let him slide.

I send out invoices by e mail on the 15th of every month and clients have fifteen days to pay. Some of my clients pay up front, some pay on time and others are within a day or two or three late.

I had a property manager that I worked for who would consistently pay about two weeks to a month late, and then not pay the full invoice. I eventually got sick of the BS and dropped her. If you consistently have people paying more than two months late I would drop them. After my debacle with the property manager I decided that if they haven't paid in full by the time the second invoice is due I cancel service. After one week late I email them a notice and then at the two week mark I attach the late invoice to the current invoice. It should also be noted though, that the amount of **** that I'm willing to put up with is directly proportionate to the amount of money that you're paying me ( when you pay me ).

I don't bother with late fees, nobody pays them.
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I tend to agree with that. After doing this for 14 years I just get tired of people calling for work and expecting it done when they say jump and then taking their sweet time to pay me. Ive offered easy solutions to them like online pay but it just seems its part of their nature.


Quote:
Originally Posted by LawnMowerMan2003 View Post
I'm not really suggesting this, but I stopped billing people, because I decided it wasn't worth the extra collection time spent, and I don't like waiting for my money. However, I'm not doing contracts either. I suppose if you do contracts people might expect to be billed. My payment policy is that payment is due at time of job. If the person is not going to be home they have the option of leaving the payment there. Of course, if I start doing commercial I guess I will not have a choice (for some, I did some truck stops that paid the same day before).
I just don't have time to wait around at 75-100 accounts weekly for them to pay me. I want to get in and get out ASAP and standing around while they pay me isn't conducive to getting work done quick.
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  #13  
Old 06-03-2014, 10:10 PM
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360lawncare 360lawncare is offline
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Location: Mocksville NC
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We bill on the 15th via email and they have 15 days to pay. Works pretty good only have a couple that take the full 15 days to pay.
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  #14  
Old 06-03-2014, 10:17 PM
32vld 32vld is offline
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Join Date: Feb 2011
Location: LI NY
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I tell new customers that payment is due ten days from the date of the invoice because I need to avoid cash flow problems. Thus I give them a reason that has nothing to do with that I do not trust them so they do not feel insulted.

I have one commercial customer from my first year in business that always pays up to 5 days into the next month. Small lawn for $40 a week. They do not do much up sell work other then a fall and spring clean up. I made good money this year doing snow for them.

They never have been later then into the first week of the next month. So I let it slide. This is the way they have always been. Though their slowness got me thinking of how to avoid any more people like them. This is how I came about putting the payment due in ten days line on my invoice.
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  #15  
Old 06-04-2014, 01:28 AM
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TPendagast TPendagast is offline
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Location: Wasilla, AK
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Quote:
Originally Posted by FLC2000 View Post
Tried that. Most of them still want to pay by check.
Well do like they used to do at gas stations.

It's 3.00 gal cash and 3.15 credit.

Except for you, a $50 lawn is $55 by check and $50 with pre approved CC.

see how they want to pay then?
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  #16  
Old 06-04-2014, 09:02 AM
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snomaha snomaha is offline
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My experience has been that A/R needs to be a process just like all other office duties. When to send statements? when to make the first and second call for payment? When to put a hold on a account? when to file a lien? who is responsible for owning it?

Our controller is responsible for A/R - we have net 30 terms. Monthly, she gives me a DSO (day sales outstanding ) report.

DSO = AR/average sales per day.

Our goal is to have DSO at 26 days or less. Basically, we are turning over A/R every 26 days. We know from past history that if we get above 32 - we are probably dipping into our line of credit due to cash flow issues.
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  #17  
Old 06-04-2014, 11:55 AM
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Efficiency Efficiency is offline
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Quote:
Originally Posted by snomaha View Post
My experience has been that A/R needs to be a process just like all other office duties. When to send statements? when to make the first and second call for payment? When to put a hold on a account? when to file a lien? who is responsible for owning it?

Our controller is responsible for A/R - we have net 30 terms. Monthly, she gives me a DSO (day sales outstanding ) report.

DSO = AR/average sales per day.

Our goal is to have DSO at 26 days or less. Basically, we are turning over A/R every 26 days. We know from past history that if we get above 32 - we are probably dipping into our line of credit due to cash flow issues.
How dare you use mathematics in your business!
https://www.youtube.com/watch?v=mFEzW1Z6TRM
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If this post seems mean, it's probably because I'm drunk posting. Maybe my next one will be better...
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  #18  
Old 06-04-2014, 03:39 PM
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snomaha snomaha is offline
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Location: midwest
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Quote:
Originally Posted by Efficiency View Post
How dare you use mathematics in your business!
https://www.youtube.com/watch?v=mFEzW1Z6TRM
Yeah - seems like math works better than the "hoping payments come in" strategy.
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  #19  
Old 06-04-2014, 08:36 PM
oqueoque oqueoque is online now
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Location: haddon hts. nj
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Raise the price on the slow payers 10%, then offer them a 10% discount if they pay in full within 15 days. If they complain drop them. This might work better at the beginning of the season.
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  #20  
Old 06-05-2014, 10:06 AM
Vital Business Group... Vital Business Group... is offline
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Location: FRANKLIN TENNESSEE
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Another idea is a slight price inflation for new customers, followed by a small discount on the bill. You could do this for new customers if you think getting paid faster is worth a couple bucks.

Say their invoice is for 150.
Balance due: $150 by June 15th
$147 if paid before June 10th.

Worded much better on an invoice, this has helped some of our customers see the checks roll in a bit quicker.

It is essentially the opposite of a late fee.
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