How Do You Handle Customers Who Don’t Pay

Unhappy Remodeling Customers

Hopefully not this way!

This video is funny but it really happened in England. click on this link to see the original news video.

Unfortunately I am also familiar with local Concord contractors who have experienced customers not paying. As I was pasting this funny video I started thinking about why I have not had to deal more with this issue.

With the current state of the economy, I have found that getting customers to pay in a timely manner harder to do but they always pay.

I’m not sure why I’ve been unscathed.  So how do you handle customers who don’t pay, try these ideas:

1. Customers hate surprises. communicate and educate what they should expect and how the job will progress.

2. Make sure you and your customer are talking “apples to apples.” consider having an architect sketch a quick drawing, or provide you with a photo or magazine clipping . What a customer sees in their mind may not be the same thing you see.

3. Have a written contract. Make sure you have a lawyer check your boiler plate language.
4. Document everything, especially changes to the original contract.
   
5. Luckily I have not run into a situation where the customer has refused to pay, although I have had to chase a few people to pay me.
6. Assume that most people are honest and want to pay you. Treat customers with respect.
7. Try to find out why a customer is not paying. Listen – Has he or she fallen on hard times—a lost job or ill health? Or, is he withholding payment because your product was faulty or your service was poor?
8. Keep the customer’s past payment history in mind. Is this the first time ever or a regular occurring thing?
9. Be a good listener. When you understand the situation, you can come up with solutions that will help the customer get you paid. Payment plan?
10. A customer is more likely to pay a friendly creditor first ~ so be nice.