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Billing Question

Discussion in 'Business Operations' started by fairways, Aug 18, 2005.

  1. fairways

    fairways LawnSite Member
    Messages: 51

    I am currently billing at the end of each month and I am having a problem with some customers paying late, currently the invoices say "due upon reciept". Some customers are paying me a month to a month and a half out. I currently don't have any late charge fees in place, but I am thinking that I need to set a late date and a fee. What do some of you charge for late fees?
  2. OMG

    OMG LawnSite Senior Member
    Messages: 275

    I bill at the end of the month also.

    I charge $5 extra per cut if paid after the 10th.

    In other words, if we cut 4 times on the previous bill and it's not received by the 10th, $20 is added to the next bill.

    I don't want money trickling in all month---to much of a headache to keep up with......I prefer monthly billing.
  3. KINGjosh

    KINGjosh LawnSite Senior Member
    Messages: 531

    This for me has been a real pain for the last couple of years. I used to put up with it till this year. Due to the fact that I could not afford to lose them. They always paid but always late. Now is a different story though, I will drop their azz in a heart beat and send them a serious letter!
  4. The Ripper

    The Ripper LawnSite Member
    Messages: 132

    I send out bills on the 15th of every month with a due date of the last day of the month. If they don't pay on time I go to their house on the weekend usually in the morning and I hand deliver them a new bill. I then tell them that I didn't receive a payment from them so I figured the bill must have gotten lost in the mail. They always pay right then and they almost never pay late again. Who wants me at their door at 0900 on a Saturday!
  5. turfsurfer

    turfsurfer LawnSite Senior Member
    Messages: 364

    I include a line under the amount due "due on receipt, after 15 days pay" then I tack on at least a $5 late fee (more depending on size of bill).
  6. Maitland Man

    Maitland Man LawnSite Member
    Messages: 175

    I used to bill at the end....and I had the same problem. In doing that, you open yourself up to covering operating expenses for up to two months sometimes without getting paid for any work. With labor, fuel, machinery, and other expenses....it's just not a smart operating practice to fork over all that money out of your pocket to manicure their lawn, then wait 45 days to gewt paid....No WAY! So, I moved it up to the 15th like Ripper said, as well, I'd knock on the door after the last cut of the month if I haven't received payment yet. A year and a half ago, I slowly moved up the billing date to the 10th of the current month of work....now I bill on the first of the service month. New customer?..........."Yes mam, I can get you on the schedule for next week, I just need a check from you for this months service, and you'll be on the schedule, after this, we'll send out an invoice on the 1st of each month, and we ask for the payment to be in by the 20th, after the end of the month, it is considered late, and a $15.00 late fee will be added to your next invoice." I've never had a problem with this.

    If you are currently billing at the end....move it to the 15th...it's half way through the month, and if customers say...."Well, I'm paying in advance?" ....say "NO, it's half way through the month, by the time you pay, I've at least done 2 cuts....kinda like a 50/50 thing." It'll work, trust me. If after that, you want to bill at the beginning, do it. Just offer a $5.00 discount for "early pay"....if the payment is received by the 15th, you get 5 bucks off next months service, and let them know that you bill at the 1st to let everyone take advantage of the discount. Show the $5 discount on their bill for a few months if they pay early, and charge them 15 bucks if it's after the 30th. After a few months, just bill them for there monthly service on the 1st at the reduced rate(not showing a "early pay discount", and the customers will come to know it as the norm.


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