Erin, You’re All About the Money!

Posted by on Aug 9, 2010 in Business Tips | 20 comments

This weekend and past week, I’ve had the unfortunate experience of dealing with a non-paying client.  Generally speaking, we collect pre-payment on all services and then keep detailed time logs of the work that is complete.  We allow our clients to have a period of time to look over the time logs and if they have anything they are unhappy with or wish to clarify, they can do so and we work with them to ensure that they are satisfied.

Every once in awhile, I’ll meet a client who is just awesome.  Or, at least it starts that way.  The client is happy, excited, we finish some really great work for him/her and over time, develop a relationship that seems like it’s going to last forever.  That is until the client runs out of money.  Now, we do our best to help our clients make money but we can only do so much.  For example, if we suggest that the price on their newest program is ridiculously high and they don’t adjust it, it is not our fault if they do not sell seats into that program.

So, this past weekend, I was dealing with someone who had obviously run out of money.  How do I know this?  Their eChecks have come back NSF (non-sufficient funds) at least three times and the time between invoice and payment was getting longer and longer.  Now, since we had entered into an awesome relationship, I had allowed them to pay-as-they-went.  Yes, I know.  Stupid mistake on my part in hindsight but this person seemed like a trustworthy person who had appreciated and loved the work we had done to date.

Here we were with two open invoices that were unpaid.  I had mentioned that after these invoices were paid up, the client would have to start doing pre-payment on all work since we couldn’t wait any length of time before getting paid.  I mean, that’s only fair right?  You do work, you boost someone else’s business and they pay for that work to be done.  Seems like a logical business transaction to me.  I was willing to work with this client to come up with a plan that worked for both of us if need be.

After mentioning that we would have to go to a pre-payment after she paid up on what she owed, she conveniently found a new team to work with.  Then, the finger pointing e-mails started.  Up until now, the client had been more than happy with the service.  However, when it came time to having to pay the bill, there were all of these things that we had apparently done wrong, things they weren’t happy with and “other clients” that they had referred who were also unhappy with the service.  (Side note: after checking with those “other clients”, it turns out they are more than happy.) The kicker was that in one of the e-mails, the line was used that I was “all about the money.”

This line has inspired this blog post.

Why do people think that asking for payment on work you’ve done is being “all about the money”? Of course I’m all about the money.  If I do 25 hours of work for you, I want to be paid for that work.  I don’t run a charity and I certainly need to eat.  However, I’m also about other things – being flexible, providing value to my clients, checking in to ensure that they are happy and listening to problems when they come up and working to fix them.

Being “all about the money” is not a bad thing in business – it’s a necessity. Wanting to be paid for work that has been performed is not a privilege I have to earn – it’s what should naturally occur in a business relationship.  Thinking that you can run a business and not focus on the money aspect is just silly.  Again, there are going to be other aspects of your business that are equally as important but YOU WOULD NOT HAVE A BUSINESS IF YOU DID NOT COLLECT REVENUE.

Entrepreneurs that don’t pay their bills or who haggle invoices or who discredit the work of the people who work alongside them need to grow up. Being in business is about creating fair transactions on both sides.  It’s not about trying to get things for free and it’s certainly not about dodging out of paying your invoices.  That’s just poor business practice.  Instead, these entrepreneurs should be paying their invoices with gratitude knowing that the support they are receiving, in whatever format it comes in, is awesome and helpful.

I’ve got some work to do to our own invoicing and billing allowances but if anything, this situation has taught me that I am totally okay being “all about the money” sometimes.  Otherwise, I wouldn’t have a business that could sustain my day-to-day life for any length of time.

What do you think?  Is being “all about the money” a bad thing in business (keeping in mind that there are still those other areas of importance I mentioned previously)?

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  • http://twitter.com/RebeccaZwar Rebecca Zwar

    Hey Erin, I've had one or two similar experiences, though luckily, they kept the name-calling to a minimum. It's a business – it is about the money! How in the world could you provide the quality service they came to you for, if you had to work full-time to generate an income for paying your own bills? They (hopefully) expect to get paid for their work, and so should you. If they don't, they need a serious revision to their business model! Good luck with everything :)

  • http://www.bsetc.com Erin Blaskie

    Thanks Rebecca! I too haven't had to deal with this often (it's never resorted to a collections agency, that's for sure) but when it does happen, it's a huge punch in the gut. You do your best work, you get behind them 100% and then they don't reciprocate. It makes being in business tough because seriously, where the hell is the love? ;)

  • Kris

    I don't think it's a crime to want to earn. It's what keeps business going. I recently had to fire a client because he kept adding work to a discounted rate I gave him. I had given him nearly half of what I usually asked, because I believed in his business. Which, unfortunately, he still thought of kind as kind of high because a) I am Filipino and b) he didn't have enough money. When he started adding more work, so he could get the most bang out of his buck, I had to stay STOP.

    I think some entrepreneurs are so passionate about their vision, that other people should be compelled to help them change the world, even for free. But business is business. If you pay me late, I pay my bills late. If you work me to the bone, and not give me enough compensation, even the best of business start to look pretty crappy. If they wanted people to work for free, they should have recruited volunteers. That's why we have charities.

    Re: the hard collection…I find that sending a certified letter from an attorney often works.

  • http://www.bsetc.com Erin Blaskie

    I agree with you Kris. We've had to put a stop to clients as well – especially those who have purchased a package and had defined items on the package but tried to add a bunch of stuff to the package.

    I think you're right — people feel like we should want to be a major part of their businesses and you know, I do. However, the minute that I don't feel like my services are respected in their company, I lose a lot of my excitement for the project and the work. Especially when it goes to non-payment.

    I've already looked up the laws in the client's state (actually, a colleague did and sent me the details) and it's actually a felony to let NSF checks occur over a certain amount so I'll be making sure to bring that to their attention as well. I hate playing hardball with anyone in business – it's so not my style – but when you get ripped off by 25+ hours of services, it's hard to let that go.

  • Hha777

    Very well said Erin!! =)

  • Kathy

    The worst part is if a client did this to the individual you describe, she would be livid and ready to knock down their doors to collect. She wouldn't be “all about the money” but would be justified in being compensated for her time and effort. We are all looking for clients who value what we do and understand what a business relationship is all about but there will be times we run into these types of clients. Don't let this experience cause you to change how you deal with other, good clients though. There are plenty of people out there that are good clients and pay on time!

  • Stephanie

    You deserve to get paid for work done. If the work was so bad, why did she keep letting you do the work. I can't stand this. If a client tells me they're running short on money I am happy to delay work until they catch up, but yea, I'm all about the money because my landlord is all about the money, and my grocery is all about the money…. even my doctor (I'm in the USA) is all about money!

  • Cheriak

    Eek! I am currently dealing with a similar situation and similar personality. I have realized that the woman I'm dealing with does not like to “let go” of her money and will find any excuse not to and draw it out for months or longer. I am one of many businesses she has done this to. And, like your client, she gets offended to the extreme with any “conditions” surrounding payment. This personality, shall I say, is… psychotic to a degree, completely irrational and explosive and having had the displeasure of working with this type. I feel for you!

  • jen

    I've always felt it was a shame that clients like this can't be “outed” – there's a catch-22 where no one wants to look bad and slam an actual client, but how horrible that this woman found a new team and probably convinced them she was a wonderful client to work with. Of course, it's a double-edged sword when I see people working with virtual assistants I know are going to flake or fail eventually because they have a long history of doing so. There should be some way to know before you hire if you're getting a gem or a germ, either way. I hope you get those last invoices paid.

  • CaptainObvious

    “Being in business” is also about smart strategy to borrow the phrase if you fail to plan you're planning to fail. A healthy customer relation starting point is 33.3% upfront on all work. If it's open ended work then you ask for a “retainer”.

    Always have your customers enter into a contractual arrangement with you, the contract should set out the events which trigger an obligation on the part of the customer to make further payments. They default on you then you start a small claims suit (presuming most of your work is under 25k). If you're dealing with a “new” or under financed organization/corporation then you have the operating people, sign both as officers of the corporation but as well as individuals which allows you to sue both the company but the individuals.

  • http://yoonhoum.com Yoon Ho Um

    Try telling that to the bank or private lender holding your mortgage note after missing a few payments… “But… you can't kick me out… you're all about the money…”

    Or at a job where the boss decides that he can't pay you on time and when you legitimately ask for your money for work already provided he just says “You're all about the money.”

    Or what about that credit card bill collector LOL “Um I'm not paying you anything more that I OWE you, I already paid the minimum 3 months ago… how can you de-activate my card??? You're all about the money. I'm just going to get another one with someone else.”

    Let's get serious here… if a client can't/refuses to pay you then how're you going to pay all those talented people you have working with you?

    This sounds like stuff that happens with friends when you lend them money & ask for your money back way after the agreed upon repayment date & then they get upset (Of course they conveniently forget how you HELPED THEM in the first place.) and no longer want to be friends with you… Good riddance? *shrugs*

    Friends + Money don't always mix well and it seems like “making friends” with clients isn't the way to go but keeping it all impersonal and strictly business-like… but then that really would make it “Erin, you're all about the money!” wouldn't it?

    And that's not the Erin Blaskie we've grown to <3.

  • http://twitter.com/BayAreaVA BayAreaVA~Margaret

    WOW. Anybody in business is “all about the money” including this former client of yours. Such a shame! And its funny about how you didn't hear about how “badly” you and your team was doing till she couldn't pay the bill lol Well, we live and we learn.

  • http://www.bsetc.com Erin Blaskie

    Thank you – it definitely was a learning lesson for sure! Luckily, I believe big time in karma so while I know that I did nothing wrong and won’t be affected, that past client can probably not say the same thing!

  • http://www.bsetc.com Erin Blaskie

    Thanks Yoon – it’s so true! Any other business on the planet would not listen to excuses or personal attacks. They’d just go after their money because it’s rightfully theirs!

    It is a fine balance between business and friendship. It’s one that I’m still trying to learn how to perfect ;)

  • http://www.bsetc.com Erin Blaskie

    We do request funds upfront for 90% of the work that we do – we just have some clients that we allow to go on a more pay-as-you-go basis. The client does have a contract but is still avoiding their responsibility to the contract. However, if I take this to court, she won’t have a basis for refusing to pay – it’s all in black and white.

  • http://www.bsetc.com Erin Blaskie

    Jen, I completely agree with you! Clients who hire virtual assistants will go out into the world and tell everyone about their horror stories (I’ve heard hundreds) but we, as virtual assistants, can not (or maybe it’s that we choose not to do that… I think it’s just a form of gossip and hatred to be honest). I wish there was some sort of client blacklist that we could put these baddies onto!!

  • http://www.bsetc.com Erin Blaskie

    It’s tough, isn’t it? I often find that dealing with people and money can be a very tiring thing. I try to keep my business as flexible as possible for the client but I’m quickly realizing that I just need to crack the whip and do what works for my business.

  • http://www.bsetc.com Erin Blaskie

    Stephanie, I totally agree with you! She was happy up until the point that she decided, “I’m going to try and get out of paying this.” The saddest part is that she’s still referring business to our company… maybe it’s her guilt?

  • http://www.bsetc.com Erin Blaskie

    Exactly Kathy! It’s a double-edged sword for sure.

  • http://www.bsetc.com Erin Blaskie

    Thank you :D