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Getting Paid

Sep 28, 2012 | Uncategorized

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We always hear about the many benefits of being on your own: the freedom, being your own boss, making your own hours, hanging out at Starbucks all day, sipping your pumpkin spice latte while you hog up their free Wifi. Sounds good right? But what about getting paid? Well, as they say, that’s a whole ‘nother story.

One of the things people with ‘regular’ jobs take for granted is that they know exactly when they will get paid. Either its every Friday or its every other Friday but they can mark it on their calendar as ‘payday’. Despite the fact that in today’s economy, no job is guaranteed, most people that work for someone else can count on their money being on time, and in fact, so much so, that they practically plan all of their bills, and their lives, around payday.

Rewind back to the freelancer, or the entrepreneur, or the small business owner and lets’ put all of the glamour and excitement aside for a few minutes. What most people don’t realize is that we don’t know exactly when we’ll get paid. All we can do is hope that when our clients say that ‘the check is in the mail’ that it actually is.

For the most part, any client worth keeping is going to pay on time. The thing is that for some folks the concept of ‘time’ is used very loosely. You can do your best to set terms on your invoices, but ultimately, each client will basically end up paying you when they damn well see fit to pay you. And conversely, you will begin to learn which clients will require full payment up front and which clients you will begin to avoid all together, if not fire and remove from your contact list entirely.

The time and energy that it takes to stay on top of the ‘persona-non-paya’ can literally drain all of your reserves and leave you high and dry.

Here are some tips to help keep the cash flow going and encourage clients to pay on time:

Convert to Retainer

Once you have established some history with a client, or have provided creative services to them for a few months, take an average of the total amount of time spent per month and offer them a price break if they agree to pay a flat fee, every month, IN ADVANCE. By offering them a price break, you can also negotiate a longer term. I recommend going for a full year.

Break the Total into Payments

Many times clients balk at the sheer size of the project cost estimate. The last thing you want to do is to have to start a project without a deposit. Especially a long-term, labor intensive project. In those cases, you try and get a 60% deposit up front. The problem with that is that 60% could be a substantial size nut. Instead, breaking the project up into 4 or 5 equal payments (typically the length of the project should match the amount of payments) might make it more palatable to the client. Get some cashflow going. That is always the goal.

Agree to Terms up Front

These days I don’t start any project, big or small, without a contract.  Clearly illustrate when you’ll invoice and how long they have to pay (terms). You’ll find that some clients need 30 days, and others will try and stretch it to 90. You cannot survive if everyone is at a 90-day billing cycle. You can’t tell the cable company or the electric company that you’ll pay your bill every three months so don’t get into this habit. Always include the stipulation that you will not release final, or layered files until the project is paid in full.

Stay on Top of the Overdue Payments

The squeaky wheel gets the grease, and gets paid. Even though it’s the last thing you want to do each morning, and you may often feel like a pest, you’ve got to hammer away with email reminders or even phone calls if you have a past due balance. Keep contact professional, short and not so sweet. You are collecting cash that is owed to you for work you have already delivered. Everything is not peach-fuzz if you have to repeatedly remind clients that they owe you money. Fortunately, I’ve never had to use a collections firm, but I would if I had to.

Don’t get Burned… more than Twice.

I have a client who is notoriously late. This guy uses all of his creativity coming up with yet another excuse as to why he hasn’t gotten paid and consequently, can’t pay me. The only thing he ‘buys’ is time with long stretches where he goes absent and unresponsive. Great guy otherwise, who loves to blame whomever it is that HE’s working for. Listen pal, the only buck you should be passing is the one that should be coming my way. I wish I could fire him, but the problem is that he often brings me high profile, A-level client, name-brand projects. I know going in, that its going to take me forever to get paid. In cases like this, you have to size up the profile of the project and see if having that client in your portfolio warrants the time and aggravation it will take you to finally get paid. Ultimately, this fellow may prove to be more trouble than he’s worth, especially if you sense that its just his M.O. and if his roster of clients starts to become the equivalent of a B or C celebrity. At that point, it doesn’t matter who he’s working for, if he’s not paying you, then he’s not paying anyone else and he’s probably just a small part of an even bigger web of negativity that you don’t want to get caught up in. Cut your losses and let him know that you’ll have to pass on that next big project.

Yes. Invoicing sucks. It has forced some freelancers back into the 9-5 workforce because they were simply not wired for the level of stress you may have to endure. Some clients will ignore your bill until kingdom come, but that doesn’t mean you can’t do something about it. Stick with those clients that do value your services and do pay you on time, and as you grow your business, start eliminating those that are really just out to take advantage of people. As you project a more professional image and deliver your end of the bargain on time, you will begin to attract the types of clients that will reciprocate that by paying you on time. No one likes to send out reminders and there’s nothing worse than checking your mailbox and finding nothing but junk mail.

Then again, there are few things better than finding a mailbox full of checks from happy customers. If you play it right, you’ll find yourself  laughing all the way to the bank a lot more often and more importantly, on a more regular and consistent basis.

A few other tips by Georgina Laidlaw on “How to Get Paid”


Ramon has over 19 years of experience in award-winning, market-proven, print collateral, marketing material, iphone/ipad app and website design specializing in corporate identity and branding. Ramon’s passion for entrepreneurial design was borne out of 10 years as Creative Director for Jay Walker at Walker Digital, the Stamford based idea laboratory and business incubator holding over 300 US Patents. Ramon served as Senior Art Director on the start-up launch team behind Priceline.com, a Walker company and invention. Most recently, Ramon’s logo and identity work was selected to be published in “Typography and Enclosures” the fourth book in the Master Library series by LogoLounge.

Need help with your brand identity or want to overhaul your existing brand? Contact: ramon@peraltadesign.com

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