Late payment charge or not???

Discussion in 'Lawn Mowing' started by Tomslawncare1, Dec 11, 2000.

  1. Tomslawncare1

    Tomslawncare1 LawnSite Member
    Messages: 47

    I've been contemplating a late payment charge for customers that don't pay the monthly bill on time. At the end of the month I generate a bill of the services performed for that month. I have 30 or so customers of which 27 or 28 pay within a week or two. But there is always the one or two that never seem to pay on time. I usually have to send them a second bill. And yes they are the ones that are the first to ***** if you happen to forget something. Just wondering what you guys, gals, do. It's easy to say drop them but I'm looking for a better way so that both parties can be happy. If you think I should charge, how much should I charge? How long should I wait before I institute a late fee?
  2. Guido

    Guido LawnSite Silver Member
    Messages: 2,087

    You have to make it legal on the bill and maybe even in the contract!

    Not possitive on all the rules as far as how much you can charge and how long to give them, etc.

    Check out what the bills you get say on them and you'll be able to get some ideas.

    BUT I know this much, once you start it you must enforce it because once they see you don't, they'll take advantage of it like its a joke anyway.

    Congrats just on getting that good of a percentage to pay on time without hassle!!

    Good Luck

  3. Ocutter

    Ocutter LawnSite Senior Member
    Messages: 314

    I would like to be the first one to stick it to those late payers with a nice late fee but you have to stay within limits. Im trying $5 for payments not received the 20th of the following month. I'll give a 5 day grace pd but thats it. The ones that were late this yr I just raised. If they dont want to pay your price hell with 'em. If they stay on more money for you. As far as being legal talk to an accountant. My builder friend of mine said hat you can tack on 1.5% (18% annualy) on the total of late bills. If you take that into account it really doesnt add up to much if lawncutting.
  4. landscaper3

    landscaper3 LawnSite Bronze Member
    Messages: 1,354

    We also do monthly billing, we put all residential and commercial on a contract (residential has different language and process) we put on all contacts to be paid by the 15th of following month serviced, there may be a $5.00 late fee on all payments made after the 15th. Any payment that has not been paid for over 30days will pay a 10% late fee and services will stop until paid in full. if you wish other payment meathod please contact to make arrangements.
    Plain and simple oil companys, credit cards, loans and more all tell you have to be paid by this date or will be charged interest ect we provide a service and should be paid on time also!!!!! Just keep your language on contract simple but direct in not to piss off your customer.
  5. Lee Homan

    Lee Homan LawnSite Member
    Messages: 163

    I have a 1 customer that I picked up last year that paid in full at the end of every month and had no problem with her.

    This year I gave her the option to make payments over 12 months and to this day she is 3 months behind. Payments have been cut in half you think she would be on-time.
    I don't know if she thinks now that it's winter time she don't have to pay or what.

    Regarding late payments, I've been considering it but not sure of the legalities. I did receive my cable bill yesterday and noticed there was a statement in it about a class action lawsuit filed against the cable company due to them charging or mischarging late fees. I didn't get into it enough to know details.
  6. jeffex

    jeffex LawnSite Bronze Member
    Messages: 1,933

    raise thier cost per cut 3-5 bucks for each cut
    next year if they bitz about it let them know
    you have payments to make also. if they drop then
    the ones that dont will be paying extra to compensate
    for them same money less work its the name of the
    game for one or two man shows
  7. GrassMaster

    GrassMaster Senior Member
    Messages: 447

    Hello Everybody:

    The best thing to do is like what was said above by Jeffex & next year raise them $5 or so over what you would normally raise them to, if any raise at all.

    Now is not a good time of the year to try & impose a late fee. I lost a customer over that one time & never did it again. Now I wished I just would have tacked on a slow pay charge at the beginning of the next season to their monthly fee.

    I even raised one extra fee because the car seemed like it was only parked on grass the day I had to mow & no other time. LOL, I watched the house & that's the way it appeared to me.
  8. TJLC

    TJLC LawnSite Bronze Member
    Messages: 1,308

    I recently had a customer who was renting the house that I was mowing. I cut it twice and sent her a monthly bill as I normally do. The 15th rolled around and no money. I cut it one more time and sent out another bill with a 2nd notice past due on it. Still no money. I decide to go see her and see the house is for sale. I called the real estate company and they said she skipped out without paying rent for two months. No way to contact her. Has this happened to anyone else or was it just a stupid thing on my part to trust this woman?
  9. geogunn

    geogunn LawnSite Gold Member
    from TN
    Messages: 3,010

    I had a family that was two cuttings behind and it took 4 hours to do their side of hill estate. they kept promising to pay but never did.

    finally, they had birthday party for their little girl and said they would pay in full after I got done with the third cut. they did but I was mad the whole time I was mowing.

    deadbeats are a real drag.

    I've only been stiffed twice. fortunately, both were only about 35 bucks.

  10. Ocutter

    Ocutter LawnSite Senior Member
    Messages: 314

    TJLC- Live and learn. One of the questions I always ask the customer is if the house will be for sale soon. I pass on all houses with signs on them. They're always looking for a scrub price for a 400k house.

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