How to Get Clients to Pay

June 7, 2019

By J. Randall

This is a question almost all of us have had to consider, and it turned out to be the ideal topic for an IFDA NY Chapter panel discussion held recently at the New York City’s Cosentino showroom. Four panelists offered their perspectives: attorney Alex K. Ross, Esq., of Ross & Katz; accountant Tricia M. Taitt, principal of The Art of Money Matters; and client relationship expert Richard R. Shapiro, founder of The Center for Client Retention. IFDA NY Chapter member J. Randall of Pavarini Design moderated the group. 

The key takeaways:

1. Good personal relationships with clients matter. Make sure to over-deliver with great customer service and thorough forecasting of job costs and budgets.

2. Request a retainer up front, and consider an upfront design fee to cover the drawings and planning documents/spreadsheets, etc. This requires some prior historical data for reference and is advisable for experienced professionals.

3. Only agree to a flat fee if there are strict limits and inclusions set forth in your letter of agreement.

4. Make sure your payment schedule doesn’t leave a large amount due at the end of the project when clients may want to avoid paying.

5. To keep positive cash flow, don’t invest your own money on behalf of a client. Be sure there is always money in the retainer to cover your work in process.

6. Charge a markup on product in addition to monthly billing for construction supervision and reimbursable expenses, and make sure product is paid in full prior to delivery.

7. Know your worth and charge it in your hourly fee; be clear how that applies and is billed during the course of a project to cover time and expertise.

8. If it becomes tricky with the client toward the end of a project, make sure to do EVERYTHING you have committed to do and checked off every punch list item and that everything installed works as designed before pressing for payment.

9. Include a stipulation in your contract that suspends deliveries if payments are not made on schedule.

10. Small Claims Court is the best way to recover unpaid balances under $10,000 for unreasonable clients.