One of the hardest parts of owning many types of small businesses is ensuring that you get paid, and timely. Many professional service providers and others have been there – we do the work, we invoice the client and then we wait…and wait…and wait…for our payment – all the while hoping and praying that we won’t need to have “that money discussion”.
As Nina Kaufman tells it – “Years ago, I launched my law firm dedicated to demystifying “legalese” for small businesses owners. As a budding entrepreneur, I thought clients would reward my services with on-time payment”.
Boy, was she wrong, Nina admits:
“Instead of payments, I got excuses:
“The money is coming in, just wait until this ‘big deal’ closes!” (I’m still waiting.)
“I’m just waiting for the economy to pick up.” (Really? My landlord isn’t.)
“I didn’t get your invoice. The post office must have lost it.” (Check your trash can, buddy.)
I know the feeling – our firm, Catalyst House, has had clients who ignored our phone calls, “lost” our voice mails, or (the more honest “deadbeats”) simply admitted they just didn’t feel like paying.
Nina – “It was extremely frustrating because not only am I an excellent lawyer, I’m a good person. And it seemed that every time my sincere desire to serve my clients overrode my business sense, I was left holding the (empty) bag. My landlord isn’t interested in how much money I had billed out—he just wanted the rent paid in full and on time.”
“I was tired of acting like a bank—providing interest-free loans on my legal expertise to clients who claimed they couldn’t pay when the bill was due. That’s why I devised a step-by-step program guaranteed to reduce time chasing down clients and realize hard-earned profits”.
When we received our copy for review of Nina’s e-book, ‘Train Your Clients To Pay On Time,” we were both curious and a bit skeptical. Afterall, we have been hardened by years of in the trenches collection missions with the slow and non payment types. Well the first two sections certainly covered most if not all the basics.
For example, Nina schools us on the importance of “knowing ourselves” (our services and rates and not to waver too much) and knowing both our “ideal client profile” as well as knowing what we might expect from those non-ideal client prospects, with an eye towards weeding some of the most obvious ones out before any debilitating damage is incurred.
According to Nina, clients (like children and dogs) respond to consistency. For the most part, they want clear “rules of the engagement” and this program will show you just what they are! Here’s just a sampling of what you’ll get from this fun and informative program:
– How to set the stage for getting paid promptly and developing standard payment terms
– The 7 categories of clients to avoid
– How to be clear about what services or products you provide to your clients
– What to do when clients want to negotiate pricing, terms, or other expectations
– The pros/cons of milestone payments
– How to protect yourself against non-payment
– What to do when it’s time to take action with delinquents
– How you can resolve disputes more cost-effectively
Although it may seem inappropriate to overly stereotype the potential problem clients going in, I really enjoyed Nina’s “Step Two” of her client payment ‘training strategy’ on how to read the early warning signs of the more likely problem makers. She provided a breakdown of the “Top Seven” (dare I say “7 deadly?”) client profiles to avoid. Here are two examples:
“Desmond Dissatisfied” – No one can meet his standards. He’s a perfectionist. He will regale you with tales of how everybody else in your field that he’s gone to has been totally and completely incompetent, but of course, he knows you’re going to do an even better job. He usually won’t mention that he refused to pay all of the other people that he had hired in the past. Characteristic Catch Phrases: “You have no idea what I’ve been through with the other [service providers]. But you come recommended, so I’m hoping you can clean up this mess.”
“Halle Handshake” – Any time you mention you have a purchase order or want some sort of written confirmation of what you’ve agreed to, she gets very huffy. Characteristic Catch Phrases: “I do business honorably with everyone. Why do we need such a detailed agreement?” She may even “conveniently forget” to sign the letter that you’re sending confirming the work you are supposed to do and how much she needs to be pay for it. Don’t start work without it. You may want to “conveniently forget” to start providing the services until you get the payment terms that you need.
I know Desmond! I know Halle! Hello! Hilarious and oh so true LOL!
Beyond the ‘Know Thy Self’ and ‘Know Thy Prospect’ opening parts, Nina gets down to business with the actual strategy of training clients to pay timely even happily:
Step Three – Training The Client – begins with carefully laying out the clients’ (and your) five primary expectations, including what she calls “exit strategy” – how and when work will stop if client payments are not forthcoming, and “dispute resolution” including letting the client know the ‘worst-case scenario’ of non-payment dispute.
Needless to say the psychology of the Kaufman strategy is properly laid out in the initial engagement contract.
Step Four is your “Collections System”, including options and procedures for timely invoicing, payment alternatives, and timely follow-up (so they don’t get comfortable letting payments slide).
In all this was an enjoyable read and provided a fundamental ‘audit’ of all the steps necessary in order to avoid as best can be the slow-pay/non-pay types.
At under $50 Kaufman’s manual and related materials is a needed resource for you and your in-house manager(s) and will allow you to quickly customize her system for you own unique needs.
Here is Nina Kaufman’s Client Payment Training sales page. She has recently reworked the material into a ‘multimedia’ offering that includes the ebook we reviewed, worksheets, and an MP3 55 minute audio of a tele-class she taught on the subject complete with real students Qs & As, which I believe is the ideal delivery method for her to impart this basic and important wisdom.
Remember what Nina Kaufman says: “The sooner you start ‘training’ your clients, the sooner they will learn to behave!”
Some posts and articles by Nina Kaufman —
- Building Your Business Dream Team in 5 Simple Steps, 14 Feb 2011 in Mentorship
- Social Media Policies: Keeping Your Blog and Business Legally Clean, 08 Nov 2010 in Be Bold with Social Media
- Here’s How Business Law Contracts Can Protect Your Pocketbook, 04 Apr 2010 in Budgeting and Spending Wisely
- What Can You Get For Your Business?, 12 Nov 2009 in Take Inventory
- Putting “Strategy” into Your Strategic Alliances, 05 Oct 2009 in Seize Opportunities
- How to Ensure Employee Effectiveness, 04 Sep 2009 in Self Development
- 10 Tips for Developing Great Clients, 03 Aug 2009 in Sales Strategies
- Is Your Business Legally Healthy?, 14 Feb 2009 in Business Check Up
- Profiles of the Top 5 Problem Clients, 25 Nov 2008 in Being Proactive
- Reflections on What Ruins a Business Partnership, 17 Sep 2008 in Stay the Course
- Negotiating for Results, 13 Jul 2008 in Negotiation Skills
- 3 Big Reasons Not to Do Your Own Legal Work, 16 Apr 2008 in Smart Spending
- Isn’t it Time You Learned to Keep 100% of Your Fee . . . Every Time?, 07 Feb 2008 in Business Change
- No-Nonsense Advice about the Perfect 1-Page Agreement, 21 Dec 2007 in Dreams and Realities
- Green, Global, or Just Plain Good: Cause Marketing and Socially Conscious Companies, 21 Dec 2007 in Think Green
- Turning Deadbeats into Doves, 21 Dec 2007 in Getting Unstuck
- Preventive Care Is The Best Defense, 21 Dec 2007 in Manage it all… or not?
- The Single Most Important Thing to Know about Verbal Agreements, 21 Dec 2007 in Business Connections
- Watch Your Language! – 4 of the Most Misconstrued Legal Terms, 21 Dec 2007 in Diversity in Business
- Key Secrets to Home Office Success, 21 Dec 2007 in Home-based Business