How long do you give residentials to pay?

Discussion in 'Lawn Mowing' started by MudslinginFX4, Aug 29, 2004.

  1. MudslinginFX4

    MudslinginFX4 LawnSite Bronze Member
    Posts: 1,170

    How does everyone do their billing? I currenty bill on the 1st of the month and request payment be made by the 20th on all residential customers. How much time do you give them to pay up? Am I not giving them enough time? Or am I giving them too much time?
     
  2. 1MajorTom

    1MajorTom Senior Moderator
    Posts: 6,074

    I bill out our customers on the last day of the month, sometimes I run a day or two behind depending upon how motivated I am.... Due date which is listed on the invoice is the 15th of the month.
     
  3. dkeisala

    dkeisala LawnSite Senior Member
    Posts: 911

    I bill in advance of the month for which service is to be received. If we are going into September, I bill September 1st. If payment is not received by the time I generate the next months invoices I charge a 4% late fee. If payment is 45 from the date the invoices were sent out, I'm on the phone. Situation is usually resolved by the following week. If payment is not received within 60 days of the date of the original invoice, service is stopped and my phone calls are non-stop. My fervor in collections depends on the client and how long they have been customers.
     
  4. Dwan

    Dwan LawnSite Member
    Posts: 87

    I bill on the 1st. and 15th of every month and give a discount if paid in 10 days of billing.if they are 30 days late I call if 45 days late I stop work and call if 60 days late I send a regestered letter informing of filling small clames and a $100 service charge if I have to file. in 22 years I have only had to file 1 time.
     
  5. HOOLIE

    HOOLIE LawnSite Gold Member
    Posts: 3,981

    I bill on the last day of the month, invoices are marked "due upon receipt" Usually I get the bulk of the money in by the middle of the month. If no payment is received by the next bill, they get a late fee. I don't have any official policy on cutting off service. I just base my decisions on each individual customer (how long they've been a customer, payment history, etc.)
     
  6. Andyinchville2

    Andyinchville2 LawnSite Member
    Posts: 124

    We send out bills the week of the 20th and on the bills it says payment due on receipt.....Late fees (5% per month.....yes have to make a little money on the slow payers) apply if the billings go out the following month and we still have not been paid.....additionally, accounts that are 45 days late gets a call from the office staff to renind that paayment needs to be sent in and that an automatic $50 penalty will be added for letting it go to the 45 day mark....after about 60 days we file for judgements.....All terms in the contract.....Actually we make alot more if we collect every 45 days because of the interest and $50 penalty clause.....Unfortunately most of our customers pay asap....
     
  7. qualitylandscaping

    qualitylandscaping LawnSite Bronze Member
    Posts: 1,581

    I do the same as you ECM.. bill on the 1st, due on the 20th... If not paid by the 20th, 5% per week late fee is added..
     
  8. jerryrwm

    jerryrwm LawnSite Bronze Member
    Posts: 1,274

    Just a couple of quick questions to those that charge a late fee.

    1. Is the fact that you will charge a late fee spelled out somewhere on your invoice and contract?

    2. Is the rate charged for your late fee within legal rates for interest and/or late fees?

    I worked for a supply house several years ago and there was a dispute over equipment sold to a customer. In court they said that 1-1/2% per month on the unpaid balance was legal (18% per annum). But, since there was nothing on the invoices that stated that invoices past due would be subject to interest and late fees. So the judge threw that part of our suit out, and awarded us the $15K he owed us. You can bet your butt that the following week there was a statement added to the invoices about interst charges on unpaid past due balances.

    So, you might check your invoices and also check with your lawyer and accountant about this.

    Jerry
     
  9. Lbilawncare

    Lbilawncare LawnSite Bronze Member
    Posts: 1,116

    We send ours out every last mowing day of the month, due by the 15th. Monthly charge of 1.5% for late fees (18% apr) minimum $5.00. We have a few customers who don't pay until their bill gets to be at least $500.00, they pay the late fees and never complain. I guess getting out a pen and the checkbook is just too time consuming for them once a month. We don't worry about non-payers, they signed the contract.
     
  10. MiracleMan

    MiracleMan LawnSite Member
    Posts: 52

    Residential is billed on the 5th-10th day of the month served.
    ie September service is billed Sept 5-10 and due Net-10 days.
    5% late fee after due date.
     

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