Payments Past Due

Discussion in 'Lawn Mowing' started by tiedeman, Aug 13, 2004.

  1. tiedeman

    tiedeman LawnSite Fanatic
    from earth
    Posts: 8,745

    I am curious, but are we the only business type that is a push over for past due payments?

    I know that some of you go after you payments and charge past due for customers, but I notice that the majority of us just let it go. We don't charge the late charge and we still keep on doing the work for the customer even though they might be 2 to 3 weeks past due, yet they always will pay. Heck, I do it myself a lot of times, where I just let it go. Do we not charge the late charge because we are in fear of losing the customer if we do?

    What do you guys think?
     
  2. HOOLIE

    HOOLIE LawnSite Gold Member
    Posts: 3,981

    I'm thinking about increasing my late fees for next year, something like $29. (that's what my credit cards charge). Because I may be a day or two late with other bills, but never with the credit cards, because I DON'T WANT TO PAY THAT $29 LATE FEE.

    I don't worry about losing customers over this. Do you really want clients that pay you whenever THEY feel like it? They have no grounds to argue a late fee, I've already cut the lawn 4 times on credit, then given them ample time to pay. If they don't like it, they can go screw some other LCO.
     
  3. bobbygedd

    bobbygedd LawnSite Fanatic
    from NJ
    Posts: 10,178

    tiedman, this is why: MOST LAWNBOYS are in fear of losing a customer if they insist payment be made on time. when it gets real overdue, they ASK for thier money instead of demanding it. they have very little self esteem, and feel they are unworthy of setting policies, rules, and guidelines that MUST be adhered to. they allow the customer to run thier business. it's a shame. you have to see the shock on my new customers faces when i show up at the door demanding my money when it's due. i have this one lady, likes to pay cash at the end of the month. ok, fine i tell her, but it better be there. well, it wasn't there. this is the note i left on her car, "payment is due TODAY!! not tommorow, not the next day, NOT NEXT WEEK! it's due today! i will be back at 6 pm, make sure it's here. " as a wise man once said, "sorry, i call it like i see it." get 3 days behind on your bill with me i'll confiscate your dog
     
  4. tiedeman

    tiedeman LawnSite Fanatic
    from earth
    Posts: 8,745

    LMAO:D
     
  5. DennisF

    DennisF LawnSite Bronze Member
    from Florida
    Posts: 1,381

    Lets face it...the last bill that some customers pay each month is the lawn care bill. Some of them think that other bills are more important. Mortgage, utilities, car payment, etc all take precedence over the lawn care bill. It's a big problem for us and I don't know of any easy solution. I'm getting pretty fed up with some of them to the point of dropping them. Most of my accounts pay their bill within 10 days of receiving the invoice and I have no problems with those accounts. But it seems that 5-10% of my customers are always slow to pay and it is usually the same ones month after month.

    As far as late charges are concerned. If the customer doesn't think that the lawn care bill is important, then a late charge isn't going to impress them to the point of paying on time. They would probably ignore the late charge and pay the bill when they see fit. I think the only solution is to start weeding them out and getting rid of them and replace them with new accounts if possible. But even at that I think that there is a certain percentage of people that are always late paying their bills no matter what.
     
  6. geoscaper

    geoscaper LawnSite Member
    Posts: 107

    Part of the problem is that we don't or maybe can't report them to the credit bureaus. If you are a couple months late for a credit card or mortgage payment, it's a ding on your credit report. You're late on landscape payment they don't give a you know what.
     
  7. Gilla Gorilla

    Gilla Gorilla LawnSite Senior Member
    Posts: 923

    Now that I have around 30 mowing customers I can start weeding out the non payers and pitas. Especially since I have been picking up alot of new weekly customers this month.
    Here is a letter that my wife wrote up for one of my customers.

    Needless to say after being this behind on his invoices and seeing the damn Schwans ice cream truck pull up to his house last week as I am cutting his neighbors lawn that this will not be a customer of mine for next year unless he wants to pay a month in advance. The FAT AZZ sure can pay his bills for ice cream on time but cant seem to pay me on time.



    August 16, 2004



    Re: Suspension of Lawn Mowing Service


    Dear Mr. Huff,

    This letter is to notify you that your Lawn Mowing Service with Mow Me Over has been suspended until your overdue invoices have been paid in full. As of the close of business on August 15, 2004, the following invoices are outstanding:

    Invoice Number Invoice Date Invoice Amount
    107 07/01/2004 $140.00
    148 08/01/2004 $170.00

    Mow Me Over expects payments on invoices no later than the 15th of each month. We extend these payment terms to all of our customers as a courtesy. If these payment terms continue to be neglected, another notice will be sent to you and payment for all future services will be required at the time they are rendered.

    If you have any questions please do not hesitate to contact me.



    Sincerely,



    Justin S. Kieffer
    Mow Me Over
     
  8. tiedeman

    tiedeman LawnSite Fanatic
    from earth
    Posts: 8,745

    thats a good letter to use...mind if I copy it?
     
  9. HOOLIE

    HOOLIE LawnSite Gold Member
    Posts: 3,981

    Geoscaper,

    I'll agree with you on that one. There's definitely a "bill-paying hierarchy" Mortgage is #1, then maybe car/health ins. #2, and so on. The lawn guy is definitely at the bottom of the pecking order.

    The thing is, we should always be scrutinizing our clientele. Each year, you should take stock and consider dropping your bottom feeders. Whether they be lawns you underbid, out-of-the-way lawns, or deliquent customers. Either way, its good to continually purge your company of these few clients that lower your profits.
    Take the attitude that if you lose a $30 lawn for whatever reason, you'll replace it with a $35 lawn.
     
  10. LB Landscaping

    LB Landscaping LawnSite Bronze Member
    from Maine
    Posts: 1,309

    I have been struggling with this issue too. I have 53 regular customers, about 47 of them pay on time but there are 6 that always pay but are always late. The thing is that each one of the is right next to at least one other mow. I have let them slide only because of they are sooooo easy. I will be attaching a letter to their invoice at the end of this month though, it's the principle of it.
     

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