Question for self-employed or business people....

[G-Mac]

In addition to my full-time job, which I'm retiring from in less than two months, I do some welding on the side. I recently did a job for a machine shop. He dropped the machined parts off to me, ready to be fit and welded. I quoted him a price and he was fine with it. When he came to pick them up, I was expecting he was going to pay me. Instead he asked if I could invoice him. I said "sure". So, I e-mailed him an invoice. I put on it "Due on Receipt". A couple of weeks go by and nothing. I text him to see if he mailed payment. He said he would pay me in his next "billing cycle" and I should have payment by the end of this past week. Nothing yet. It hasn't been 30 days yet but we're getting close. I figure 30 days is standard business practice. I don't want to be a jerk because I plan on doing more of this type of thing after I retire. I have a two year business degree so I know how business is done, but I still feel like "I did the job, I want to get paid". I really don't care about his "billing cycle".

 

[arjay]

I used to hand people the bill in person and stand there with my hand out until they wrote the check lol

Invoicing people can take anywhere from 30-90 days to collect,so figure that loan (and inconvenience for us little guys)into your pricing.I really didn't like invoicing and most people understood that. One "friend" took advantage twice and after that I just stalled whenever he called with something he needed done (invariably small and aggravating!)
The guy was a dr. lol

 

[Rudi]

These days, I'd say payment at pick up.

 

[Bekeart]

MY PAYMENT PLAN

In God we Trust,
All Others pay CASH

Bekeart

 

[glenwolde]

These days, I'd do C.O.D. and take credit cards. Most people want the points anyway. Unless you have a way to run their credit you shouldn't be giving credit to anybody. You never know.

 

[Rustyt1953]

I was self employed for many years. How I conducted business back then is probably not how I would conduct it today.

 

[two-bit cowboy]

I don't want to be a jerk because I plan on doing more of this type of thing after I retire.

People will teach you how to be a jerk if you let them.

Don't let 'em turn you into one, and don't let them be one.

Despite your academic education there's this thing called "the school of hard knocks."

I don't recommend it.

 

[handejector]

Henceforth, establish your terms before doing the job.
If you want to be paid at pickup, make sure they know that and have a good specific invoice ready.

If you do offer terms, spell them out on the invoice-
"Net 10 days" or "Net 30 days" or actually put the due date
with something like "add 10% for late payment".

 

[biku324]

I do some service contracting. The terms are routinely, 'net 30,' or payment 30 days after invoice.

 

[444 Magnum]

In my part of the world, labor is paid when labor is finished.

Materials are about the only thing that run accounts. Material accounts are invoiced and mailed at the first of the month, due by the 10th, passed due and late charge on the 15th, interest at 30 days and eventually collections.

If this is a shop which will give you steady business and you want to open a monthly billed account, do so, but make them fill out an application and keep it on file with pertinent information.

If a "once every now and then" customer, payment at pickup. Hang up a sign, payment due at pickup.

 

[Hair Trigger]

When he came to pick them up, I was expecting he was going to pay me. Instead he asked if I could invoice him. I said "sure". So, I e-mailed him an invoice. I put on it "Due on Receipt". A couple of weeks go by and nothing. I text him to see if he mailed payment. He said he would pay me in his next "billing cycle" and I should have payment by the end of this past week. Nothing yet. It hasn't been 30 days yet but we're getting close. I figure 30 days is standard business practice..

He should pay you based on YOUR billing cycle, not his. You are the one who billed him, and yes, 30 days is traditional; but you might have been 20 days into your own cycle when you billed him. In the future, your invoice should read something like due on receipt, and also have a late date and late penalty, if any. You have to consider your cash flow when you bill someone, not the other way around.

I started working part-time with a friend who has a landscaping business, after I retired from being a Surgical Nurse. Since it's not an independent gig like yours, I'm not in a hurry to get paid, as SS and a pension pay all my bills and what he pays me is my fun money. I'll let it accumulate for a month sometimes, maybe more, before I'll ask him to square up, if he hasn't already mentioned it. That way, I get a bigger chunk. I've kidded him over the last three years that he actually owns most of the guns in my safe, since he "bought" them for me.

 

[hannstv]

Terms of payment are just another issue to be discussed when contracting a job. You should never be reluctant about discussing payment. Make your terms clear.

 

[Onomea]

Seller sets the terms.

He asked for an invoice. You gave him one with "due upon receipt" on it. Couple of weeks go by and no payment. You ask and he says he'll pay "next billing cycle."

So basically he is blowing you off for his convenience.

I think he's being a jerk and you are being very patient.

The advice to make terms clear in the future at the time of making the deal/contract/price negotiation is good.

 

[GypsmJim]

When I was in business and I sent out invoices, they said net 30 with 10% per month if overdue. I had a business bank account and all payments were to the business. That helped me facilitate all my taxes. I NEVER did a job under the table. All my revenue was claimed on my taxes.

When I retired and decided I would only work for past good customers, I cancelled my business bank account. Thus, any payments would have to be to my personal checking account, in my name, not the business name.

My new policy was cash (or check) in advance. Without it, I didn't work.

They could send me a 1099 if they wished, no problem. But my accounting was not to be a hassle.

I get much less business these days, as I desired, but there is no hassle.

I STILL declare all my revenue and pay taxes. That's the right thing to do. WE, the middle class, end up paying for the morons that work under the table.

 

[Golddollar]

All of my medical providers have signs in the office that say payment is due immediately upon provision of service.

 

[SC_Mike]

Half on drop off, other half when you pick it up.

 

[Golddollar]

Word gets around as to who pays their bills promptly and who doesn't. The builder of my current home said that they had no problems getting subcontractors because the subcontractors knew that they would get paid promptly by the builder.

 

[AJ]

I usually pay for things that I have made by a retired machinist when I order it.

 

[otis24]

My credit manager is Helen Waite. If you want credit, go to Helen Waite!

 

[1BadSmith]

I've owned a small masonry business for over 20 years, due upon receipt means just that...for my builders it's a little different, but still 30 days or less. But Joe Blow is payment the minute I'm done. I can't go down to my local supper club and square up a few days or weeks later. Dinner and drinks are served, pay the bill!! I get it for this one, but moving forward, I'd make sure your customers know where the bear craps!