Best way for collecting payments?

Discussion in 'Starting a Lawn Care Business' started by LuckyLawns, Apr 26, 2010.

  1. LuckyLawns

    LuckyLawns LawnSite Member
    Messages: 5

    I've just purchased all of my equipment and am ready to get started. At this time, I don't have an online billing system in place so I was wondering what the next best way is to collect payments from clients. Assuming most will not be home during the week, should I just set up a route on a Saturday to collect individually? Thanks.
     
  2. dougdm

    dougdm LawnSite Member
    Messages: 143

    All but one of mine is on a monthly mail in basis. I put the bill at the end of the month in a place that they are sure to find it. I have had zero problems yet. I do charge $25 if not paid by the 10th of the month. I keep copies of all bills to hand over to the attorney if need be. There is a phone call/message left on the 5th to remind them, incase the bill has been tossed or buried in a pile of paperwork. I keep my clients happy and in the loop of whats going on, so I begin to trust them more. For new clients, there is no forgiveness only for the ones that have gained my trust.

    A friend of mine requires his payment with in 24hrs of the job, but he is bored and retired. So it gets him out of the house.

    Happy mowing

    Doug:usflag:
     
  3. 93Chevy

    93Chevy LawnSite Fanatic
    Messages: 38,835

    I either hand out bills or mail them out after the last cut at the end of the month and request payment by the 15th of the next month. If the customer is home, I hand them a bill and they generally have a check in my pocket by the time I leave.
     
  4. LuckyLawns

    LuckyLawns LawnSite Member
    Messages: 5

    So regardless of how frequent you cut the clients lawn, you just total for the month and collect at the end?
     
  5. 93Chevy

    93Chevy LawnSite Fanatic
    Messages: 38,835

    Yeah, that's how it works. Easier on them, and easier on me.
     
  6. Sweet Tater

    Sweet Tater LawnSite Silver Member
    Messages: 2,123

    I have both monthly biling and pay at time of service, depends on the customer and how long I have been mowing for them to which they do, and also their preference if they want to pay per at time of service
     
  7. rjh4758

    rjh4758 LawnSite Member
    Messages: 220

    Same here.
     
  8. Stevegotcrabgrass

    Stevegotcrabgrass LawnSite Member
    Messages: 248

    You guys are leaving too much cash on the table. In a service industry, you should be getting paid as soon as possible to maintain positive cash flow. Collecting everyday is not practical though. You can bill the 1st of the month for THAT month and collect on the 15th. No payment, NO MOW.

    If you think of it this way, you cut all of May (31 days) you expect payment on the 15th of june (15 days) now you have an outstanding accounts receivable of 46 days if you have no late payments. A lot of people will probably not pay by the 15th because, hey you are just the lawn guy and a little late payment will not affect their fico score. This work easier for residentials than commercials since most commercials have to go through an accounting dept and alot are on 45 day cycles.

    The best part of it, is that if you are not paid by the 15 of the current billing month you stop service. Worse case scenario you are out 2 cuts approximately. You are not 60 days out or 8-9 cuts.
     
    DIYOKC likes this.
  9. 93Chevy

    93Chevy LawnSite Fanatic
    Messages: 38,835

    Exactly, good advice. That what I do. I have a steady flow of cash monthly, as well as weekly from landscape jobs. The reason most businesses fail is poor cash flow management. You can have low margins and net very little and still have a successful business because of proper cash flow management.
     
    Bradpietrzak likes this.
  10. Hell on Blades

    Hell on Blades LawnSite Senior Member
    Messages: 513

    I agree to expect paymnet by the 15th if billed on the first.

    I email a .pdf bill on the first of the month for services the month before. Followup on the 7-10th and weekly after that. I stop service on the first of the following month.

    In three years, I'm only missing $125. It's not even worth going to the collection companies.
     
    firecutgrass likes this.

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