I can’t remember where I came across Howard Mann’s Your Business Brickyard (free PDF), but this small book is chock full of great business tips. The focus is on getting back to the basics of making business fun and exciting.
One topic covered is “getting paid on time” — this is a big deal for me as a freelancer working with many different clients.
Mann first tells businesses why they should pay their vendors on time (page 39):
“No matter how good a relationship is with your vendors, nothing will break it faster than you being a lousy payer… Every day you don’t pay that bill, you add stress to another business owner’s life and to his or her business.”
This is extremely important as a business owner who hires freelancers and contractors: paying on time engenders a positive working relationship, and makes you a very valuable client. People will want to go the extra mile for you.
For the freelancer, getting paid quickly makes all the difference to providing cash flow, trust in your client, and the motivation to give 100% to the client’s work. I have had both quick-paying clients as well as pull-your-teeth-out-with-pliers slow-paying clients. It is easy to say I’d much rather work for the client that pays on time.
Mann also urges the payee to not put up with late payments (page 51):
“When you make an integrity-compromising concession to a client or tolerate bad behavior or poor payment patterns, you dishonor your purpose, your people, your business, and yourself.”
Set clear expectations of how and when you want to be paid, then be persistent in collecting the money. If you feel that you are constantly hunting down the payments, it is probably time to fire the client and find someone else who values you enough to pay you on time.