DeadBeat Customers

[JSPhoto]

Ok, this isn't really off topic, but there wasn't really a good place for it so here it is.

Some questions about dealing with deadbeat customers:
How do you deal with deadbeat customers?
How do you deal with shorted payments?
How long do you let them slide?
Do you charge a late fee? (interest or set amount)
Have you sued a deadbeat customer?

Just curious as to how you deal with this....I'm dealing with two deadbeats at the moment.

JS

[adina]

I don't have that issue. Everyone pays me before I do any work. But then I do more portrait stuff, so that isn't an issue.

What kind of shooting are you doing for payment?

[JSPhoto]

Adina,

90% of my sports is shoot first pay later as it's done through newspapers and magazines. The latter has become a problem.

JS

[another view]

I'm not really in it for work anymore but I guess I was lucky with the jobs that I have done. A lot of people in different businesses have the same problem; cut off your customer too soon and there will be plenty of other suppliers they can use who won't complain (at least not right away). Let them go too long and you might never get paid.

There will always be people you can and can't work with, and if you find a customer you can have a mutual respect with do everything to keep them. Sounds easy, doesn't it?...

[Asylum Steve]

...I've been STIFFED by clients over the years, I could probably take a year off. Well ok, maybe not an entire year, but certainly six months...

Like clients themselves, folks who don't pay fall into many different categories. Oddly enough, for me some of the worst offenders have been large companies and corporations, where the production and accounts payable departments never speak to one another, and you had to deal with each of them seperately.

The problem, like JSP says, is that to get these kinds of jobs you have no option but to work first, bill later. My mistake was not billing soon enough, and not following up aggressively to make sure my invoices were being processed.

Once some time passes, and bills fall through the cracks, getting a check cut can be like pulling teeth...

I also learned the expression, "the squeaky wheel gets the grease", is absolutely true, and for many of these jobs, I only got paid by becoming a complete pain in the ass and calling EVERYDAY complaining until they had to deal with me. Some never did pay, and no, I've never pursued legal channels...

Trust me, despite what some of you know about my personality, I absolutely HATE and RESENT having to be this way clients. I'd much rather spend my time taking pictures...

After large companies, my worst offenders by far were fashion models. They are notorious for sweet talking a photog out of getting their photos right away and paying later, if at all. They always seem to have an important "casting" or meeting with their "booker" they have to be at, and are quick to tell you that EVERYONE will see and love your work, and it will surely lead to many more jobs.

Yeah, right. Well, no more. Fashion testing is more like the portrait work Adina mentioned, and it is work were you definitely have some leverage getting paid in full before you hand over the photos.

That's the way I work now. And beautful women's "batting eyelashes" have no effect on me anymore, heh heh. ;)

The best method, if you can swing it, is to get a non-refundable deposit up front (enough to cover your expenses if your client bails), get another payment when they view the proofs, and get the balance BEFORE you deliver the final prints.

If the client is someone who will not work that way (magazines, corporate, etc.), invoice once the job is finished, make sure it goes to the correct office and person, and hold their hand by following up quickly, and stay on them until you get paid...

[JSPhoto]

I use Quickbooks Pro, and on jobs I bill I always (99.8% of the time) send the bill as soon as I get home. Over the years I have had little trouble collecting except with the paper who is continually late, and now this magazine. They were billed that night, got a response back that I'd have the check within a week. Then nothing, same thing the next week. Then the owner says he's broke and trying to collect from advertisers.
After speaking to my lawyer today, were giving him till the 26th, then it's Merry Christmas and Happy New Year see you in court. This is messing me up bigtime financially. And on top of it I finaly, after six months got ahold of a girls insurance company and find out that she never turned in a claim.....I guess she forgot that she backed into my truck in a parking lot....not once, but TWICE! Now her insurance company is trying to avoid me too. Needless to say I am not impressed with all these games at once.
Oh, and Sunday night I got rearended in my truck ....here we go again!

JS
My feeling about the holidays right now....Bahh Humbug!

[Asylum Steve]

Over the years I have had little trouble collecting except with the paper who is continually late, and now this magazine...

Yep, unfortunately that's a pretty common situation, and in some ways it's much more insidious, especially when it's a repeat client. They pay on a regular basis, but constantly drag their feet, and the trick is knowing how much you can complain to get a quicker turn around, yet not piss them off so much that they stop hiring you.

It can really tear at you...

I had a really good high-profile magazine client that gave me steady work in Miami, but took a LONG time to process my invoices and cut me checks. Most of the time I could deal with it easily enough, but from time to time I too felt the financial pinch.

So occasionally I had to drag my own feet by withholding film when they were on deadline. Of course you can't be obvious when you do this. So I would bitch that the lab wouldn't release the film until I paid them, and then mention that I needed the mag to pay me so I had enough money, you know, the old money merry-go-round routine.

Fortunately, that usually got one of their production staffers to go light a fire under the accounting department.

But again, I hated being put in that situation and using my photos as leverage. That's not the way it's supposed to work...

[adina]

...


That's the way I work now. And beautful women's "batting eyelashes" have no effect on me anymore, heh heh. ;)

...

I always fall for that one....

[JSPhoto]

I always fall for that one....

hahaha....who doesn't


but that certainly isn't the case with my present deadbeats

JS

[masdog]

I wish I had this problem. My school is pretty good about "reimbursing me" for my expenses. The first invoice took them a while to get processed since they lost it (and then I lost my peachtree backup...not a big deal since that was the only file I had in it at the time). But once I got a new invoice in, I had a check within a week.

If I end up doing the job with my Fraternity, I will be requiring half of the cost up front.

[another view]

The best method, if you can swing it, is to get a non-refundable deposit up front (enough to cover your expenses if your client bails)

I've also heard of this being called a "booking fee". Deposits, even non-refundable ones, seem like they have more of a chance of having to be refunded than some sort of fee. I think it came from portrait photographers, for just this problem. It's a legal technicality, but just changing the wording might make the difference if things get ugly.

[adina]

That would be a retainer. Not a deposit.


A deposit people want back. A retainer is to hold the day, since I don't schedule anyone else that day, if you back out, I am still compensated.

[Asylum Steve]

That would be a retainer. Not a deposit...

Yes, I chose the wrong word. I don't call it a deposit, either...

[JSPhoto]

That would be a retainer. Not a deposit.


A deposit people want back. A retainer is to hold the day, since I don't schedule anyone else that day, if you back out, I am still compensated.

Interesting point, I never thought about that....now I have to redo my recent letter to customers and change deposit to retainer.....Thank you!
Glad I started this thread

JS

[ejlatstl]

JSP,

This is a great post. Reading through your post and all of the fine replies I’m struck by the emotional impact that this situation (and situation like it) has had. Now, I wish I can say that I have not experienced similar situations but the rotten truth is that we all have.

One reply mentioned that ‘It’s not suppose to be this way…’ or words to that effect. True enough! In a perfect world it would be different. But this is the business world… far from perfect. But once you have performed a service… even if that service is an artistic one that you’ve pored you heart into… you are due the agreed upon compensation. There is no room for emotions in collections. Actually, there is no room for emotions in business.

Take all necessary step to collect your fee and DO NOT lose one minute of sleep over it. And you have already received some great advice as to how to prevent this from happening again.

Cheers,

Ed

[adina]

Personally, I don't do any work until I am paid. And I don't order any prints until they are paid for in full either.

Learned that one early on....

[swmdrayfan]

In a similar vein, I recently got stiffed by a guy who ordered $92 worth of pictures from me, and like an idiot I sent the pics before getting payment. Never again. The baseball card company I'm free lancing for is woefully slow in paying their photogs. At least 3 months, which leads me to believe they're in financial trouble or very, very understaffed.

[JSPhoto]

Wish me luck....
I filed a small claims case against the customer on January 4th, we go to court the 24th of January.
Meanwhile the guy keeps digging himself a deeper hole, claiming to be broke and unable to travel to do his magazine, yet at the same time posting on forums how he is sponsoring games and traveling to all parts of the state to cover games.
Needless to say I am printing out each admission of his travels to prove he CAN pay.

And after a phonecall tonight to a former photographer he used it appears he will be in court the following month as well. It seems the guy let something slip when talking to me and that gave the other photog the ammo he needs to get a succesful resolution to his not being paid as well.
JS

[JSPhoto]

Todays the day. I have the hearing at 5pm . I have a notebook full of info for the judge, it will take an hour for him just to read the emails and so on from this guy claiming he's broke...hmmm, but he can go travel daily to games all over...interesting.
Wish me luck!

JS

[adina]

Good luck! Let us know how this works out for you.


On a similar note, and not saying anything against your decision. Do you (collectively) feel that legal action will affect your reputation? I'm not commenting on your decision, JS, but more in general.

[JSPhoto]

I doubt it will affect me, I thought about it though. It isn't something for all situations, sometimes it's best to bite the bullet and take a hit. The problem in this case is the person has a track record of pulling these stunts, not just with me but other photographers in several states.

Don't know the outcome, the judge wants time to go over the evidence and will notify us by mail...Oh well....more waiting. I will say that he made himself look bad, especially at certain important points. The funny thing though, the opne point I thought was going to be a problem wasn't, and that was where he cancelled a job two days before it, he never said a peep, even though I was asking for full payment....that was strange considering some of his arguments, which I was able to shut down easily with proof.

JS

[JSPhoto]

Update,

This whole affair is really starting to get me very angry. At the hearing this guy flat out lied about everything, and I mean everything, but whats worse is the damn judge seems to have taken pitty on the SOB, she finally, three weeks after the hearing ruled sort of in my favor, for 1/3rd of what I was suing the jerk for, $500 instead of the $1500 he owes me. WHAT!!!!!!!!!!!!!!!!!!!!!
Anyway, I was so ticked off that yesterday I jumped in my van and drove 50 miles to the court and requested another hearing as I have new evidence that the SOB lied. I must have been really pissed because my shoulder didn't hurt the entire 100 mile round trip! I should not have been driving that far after having had my surgery Monday, then drive across Indy on I-70....the Motor Speedway isn't the only race track around Indy I-70 and 465 are also racetracks!
I get to the court, file the papers and barely being able to write hope they can figure out what I want and why.
Amongst other things this jerk tried telling the judge he gives the publications away, doesn't charge for them, and he failed to mention he not only charges for them, but he also sells ADVERTISING! So I had a friend call up who owns a business and ask about ad rates....hahaha burned that SOB.....$1500 for a half page ad! And he claims he can't afford to pay.
But you know, that isn't what really has me stoked! What really got me was when he pulled out a letter from a Big 10 university womens basketball coach saying how good his character is and how much he does for girls basketball....blah blah blah.
GOTCHA! Well he made one very serious mistake, OK, two. First he picked a Big 10 school out of state, apparently he realized I have inside contacts at IU and Purdue. But what he didn't know was I also have an inside track to all the Big 10 schools if I need. So, with one phone call I find out the coach at this school has never heard of him or his company. Uh ho......she may just pass this on to the schools legal department, as the letter is a forgery. I am going to go to court with a big ole smile on my face this time.

JS

[adina]

Wow.

Talk about drama. I love people like that. (is there a sarcasm smiley?)

[JSPhoto]

Wow.

Talk about drama. I love people like that. (is there a sarcasm smiley?)

I guess the one that would work is this one Adina (rolleyes). Some people are just plain dumb.....and this guy is one of them

JS

[JSPhoto]

The drama continues! Ok, I know this clown isn't too bright....but. On the night of the original hearing he runs home and calls or emails a photographer and proclaims the case was thrown out by the judge. No, what the judge said was "I will take this under advisement and notify you by mail of my decision", nothing about throwing it out. 2/17/06 the judge sent her decision out. Fast forward to today, not a peep out of this guy, except that he keeps telling ANYONE who will listen that he won the case as it was thrown out. He also has made no attempt what so ever to pay what the judge finally decided on. OK, it's now 30 days, so I call to see if he made any payments and they said no. Then they said they will send me the paperwork for the next phase. Now I have to get him back in court and have the judge garnish his wages and bank accounts to get the money he owes me. Figure two more weeks to get a hearing, maybe 3. Then another 2 or 3 to get the paperwork through the bank, and then wait on his checks to hit the bank. ARGH! Oh what fun!

JS