I have been burned twice in the past. I started using contracts this year and am making sure everyone pays half up front and the other half when the project is finished. After final payment I give them the product.
The last one I got burned by I did not use a contract. Double whammmy! I will always use contracts from here on out to save my but.
I currently am using echosign.com which gives 5 free signatures a month. Are there any issues anyone know of with e-signing??
We need more articles like this. All too often, we are so focused on designing and working on the project that the business end (and the legal aspect) of things is neglected. As a result, we lose money because of nonpaying clients.
And there should be. It is absolutely incredible the amount of tales we are told by clients of foolishly paying deposits or initial milestones only for the designer to disappear without trace. In fairness this seems to happen more with transactions across borders and where the clients are trying to get something on the cheap. Salutary lesson for both sides is : No contract, No Escrow = No deal.
Nice article. We’ve created a customer welcome kit that highlights (reinforces) this stuff in great detail. Much of the accounts receivable issues in the past came from the fact that “we” didn’t want to broach the subject. Not now. Every new customer understands clearly what’ll happen as a result of non-payment and non-communication.
I used to abhor collections and avoid it at all costs (my own costs, of course). But, now I’ve discovered that clients value your work only if YOU value your work. I’ve also learned that you need to educate them on exactly what it takes to create and maintain an effective site. I explain how that site will put $$ in their pockets. It’s an investment, like any other advertising/marketing. Somehow the mention of value (translate: money) for them puts everything in a new perspective!
My favorite quotes:
“You can’t take my site down. We use that to sell our products.”
“I spent #3,500 on brochures that I mailed out! I need that site up right now.”
Does anyone have a contract that covers these issues that they can share? I’m sure there are many different contracts floating out on the web, but thought I’d ask here first to save time. I definitely need to start implementing a design contract. The failing economy seems to be an excuse for clients to pass on their woes even for work already done. I’ve had them tell me that they can’t pay me until they get paid. I wish that would work for me when I go to the grocery store.
Hutchsky, you should have Chris write your agreement. A few months ago he completed our SLA and it has already steered us through a deadbeat client situation. He’s a great attorney and equally pleasant guy. Google his name and firm: Hirschler Fleischer
Great article, I use some of these methods already but I will definitely reviewing my terms of business and agreements before taking on the next client.
This shouldn’t happen at all, but I’m not surprised to hear that this happens when a client is trying to get something for less than what a reputable designer would charge. My clients know that they can get design work elsewhere for much less than what I charge. But they also know the risks they would run in going to those places.
My policy is half up front and a signed contract. No escrow.
Thanks again for a great article. Its so true. I have also found that, deadbeat clients either dont know what is required and need to be taught. Or they know perfectly well and use the devs ‘kindness’ for a crutch to control the dev.
I had to take a site back from a client that later turned more income than the project was worth. Never sell yourself short, the rewards are greater than money.
Always have contracts and their signature on the dotted line. Then if they do not pay, you can take legal action. If they are truly deadbeats you may still not get your money and wasted your time.
Excellent article. The most important piece to me (something I’ve done for years) is that I own it until it’s paid for. I also host my own development server to make sure my sites stay where they should.
My rules generally are:
Don’t go to work until you’re hired. If there’s no contract, there’s no work.
It’s mine until you pay for it. If you paid 99% of it, it’s still mine.
If you violate terms, I stop working. If we have an installment plan and you fail to come through, I work on something else until you show up with a check.
