How much credit period for payments

gnizitigid · March 20th, 2012, 01:14 PM

Hi,

I am just trying to take idea how much credit period you give to clients for making payments.

1. For big clients, i can give one month credit period, but few are taking more than two months and if i ask, they saying that as soon as clients will pay, they will pay me, otherwise they will look for another digitizer.

2. Does is make sense to charge $10 per design and still give credit of two months.

I do not know how big they are if they can not pay me after two months also. I also can not say them that they can use another digitizer, as they owe me payments and i have to do work for them.

Robert Young · March 20th, 2012, 05:12 PM

yes, what you are experiencing is COMMON in our industry. Digitizing is more a commodity now than ever so some clients pay when and if they feel like it. But I do think the number of digitizers offering terms keeps going down each year, so those that go from one to another eventually will have to start paying for their digitizing.

I agree that it seems unfair that you provide a service in a day or less yet have to wait and wait for payment.

Screen Printer · March 20th, 2012, 11:43 PM

The bottom line is you need to give excellent service...then demand payment with credit card before you release the sew files.

But you can only do this if you are not scared to lose them.

If they are living that tight...one day when he decides to go out of business...guess who won't get paid?

If he leaves you for cheaper or delayed payment..chances are he won't receive the excellent service he gets with you and in a matter of time..he will be back.

Let me tell you one thing...You go to Walmart...buy a big screen TV.....a set of tires....and a basket full of groceries.

You pay the woman up front.

Once you paid her...she closes the register....you say....awe...I forgot to buy a pack of gum.
She will gladly ring it up for you.

Why do people feel that a small business person doesn't need his money up front or has to give something free with a large order?

Where are you located?
Do you talk on the phone too?

I hate dealing with people that will only respond through email.

Sometimes....you can explain something in 1 minute that will take 15 minutes to type.

Quote:

Originally Posted by gnizitigid

Hi,

I am just trying to take idea how much credit period you give to clients for making payments.

1. For big clients, i can give one month credit period, but few are taking more than two months and if i ask, they saying that as soon as clients will pay, they will pay me, otherwise they will look for another digitizer.

2. Does is make sense to charge $10 per design and still give credit of two months.

I do not know how big they are if they can not pay me after two months also. I also can not say them that they can use another digitizer, as they owe me payments and i have to do work for them.

Printwizard · March 21st, 2012, 02:36 AM

90 days, the new normal....

powerstitch · March 21st, 2012, 04:16 AM

Quote:

Originally Posted by gnizitigid

Hi,

I am just trying to take idea how much credit period you give to clients for making payments.

1. For big clients, i can give one month credit period, but few are taking more than two months and if i ask, they saying that as soon as clients will pay, they will pay me, otherwise they will look for another digitizer.

2. Does is make sense to charge $10 per design and still give credit of two months.

I do not know how big they are if they can not pay me after two months also. I also can not say them that they can use another digitizer, as they owe me payments and i have to do work for them.

70% of the work I do is paid upfront. I learnt my lesson from cheats in this industry. If other digitizers want to offer free designs, I let them.

I believe if someone is seriously looking for a good digitizer then they will pay $10.00 to risk that. What is $10.00 these days??? But if they insist to have it for free then I just refuse cos you know they are not legit. I might be wrong in some cases but Im not willing to risk it anymore.

I prefer to get customers from word of mouth who trust us and are ready to risk paying us upfront. If they can do that, I will go out of my way to ensure they get 110% for their money. Thats how you build trust.

30% of my customers are on credit but these customers were once on advance payment but after working for atleast 6 months on advance, we then eventually offer them credit, so the customers we offer credit to are all long term customers who are happily satisfied with the quality, service & price. Sometimes I dont bill them for 2 months but I know they are reputable companies who I have already built a strong relationship with.

Customers who haven't paid you for 2 months, make sure you bill them on time. As soon as they make a payment to you, followup with an email or call after a week and request for a 2nd payment because you need the cash urgently for expansion. As soon as they pay you the 2nd payment, stop servicing them. You might loose out of few orders which you will do during these 2 weeks of chasing but atleast you now have 80% of your money and peace of mind.

If a customer threatened me they would go elsewhere, I wouldnt think twice but tell him / her on her face they are free to choose their digitizer. Remember you are in business and not a charity. I dont let my customers dictate me like that. Customers who threaten you like that are not going to be loyal for the long run so better they go and you look for other loyal customers. You will notice how much nicer it is to work with loyal customers as opposed to customers who are always complaining and wasting your time.

I am yet to list customers who have used us and not paid us despite several reminders.

gnizitigid · March 21st, 2012, 11:25 AM

I think listing of non paid clients can help other digitizers