You have one final course of action at your disposal: report them to Dun & Bradstreet and/or other credit agencies and bring a court action against them. Send your client a certified return receipt letter and email explaining the procedure you will use should they not respond, while expressing your unhappiness in a professional manner in taking these steps and at losing their future business.

You may not want to take these final steps, but again, remember what is at stake here—your business and your livelihood. Even the worst experiences can teach valuable lessons that will help in making the right decision the next time you are tempted to offer terms or you let an invoice go for too long.

I can’t stress enough just how important it is to document every phone call, personal conversation, email and communication of any kind with your client! Include the date, time and a brief overview of the communication. Document, document, document!

Each State has its own regulations regarding what tactics you can utilize to legally collect a debt owed to you as a first party collector. Check your State statutes on line. If you are doing business in the State of Florida, you may find information and forms here http://www.flofr.com/Finance/

Setting boundaries for your clients and being up front with them about how you expect to be treated will generally eliminate the need for having to go to these extremes. But, on the contrary, if you continue to offer terms to your clients without any boundaries you can be sure to expect slow payments and eventually no payments at all.

If you implement your new AR policies and clean up your past due accounts you can rest assured you will NOT be singing the AR Blues anymore and instead, you can focus on making your business all you dreamed it could be.

_{Fred Daus is the Chief Executive Officer and founder of Fredrick James Accounting, Tax & Consulting. He is a member of National Society of Accountants and the National Society of Tax Professionals and has been helping clients save money and grow their income since 2001. Fredrick James is an innovative, full service accounting firm in Clearwater, Florida with a focus on providing outstanding service, tax savings and financial growth to clients in the Tampa Bay area,  Nationwide and around the world. Visit our website www.FredrickJames.com or call 727-230-0716 for more information.}

Unfortunately, you are looking at self preservation at this point and a line needs to be drawn. So, your first step will be putting your client’s account on hold until payment is received. You may want to offer to allow a prepaid account for future services and invoices so you know current services are covered while they are paying off their past invoices.

When you make this difficult call to request payment, remember to keep it professional and polite but firm. You may get the “we didn’t receive your invoice” excuse, which can be a legitimate reason for a missed payment in some cases. This one is easy enough to resolve; email them the invoice while still on the phone and ask for confirmation of receipt. If they still don’t receive it, you’ll need to print the invoice and send by registered mail. Document the call, the email and registered mail.

You’ve played nice and kept it professional, you’ve given your client a reprieve and offered an easy out but they still haven’t sent payment as promised. Now you will need to make another call and speak directly to the owner of the business to let them know the check never arrived and suggest you will stop by personally to pick up the payment. If your client happens to be out of State, send a courier to pick it up.

Maybe your client is really having a tough time and tells you they just can’t make the payment they originally promised. It’s understandable, you don’t want to be unreasonable, so work with them. Offer to accept a smaller payment (something is better than nothing!), then set up a more attainable payment plan. Again, document every conversation and communication.

So now you’ve gone through these steps and you still haven’t received a payment. It’s time to step up your game a bit, still keeping in mind it’s best to be professional no matter how annoyed you are at this point. This is when you’ll need to start calling your client every day, at varying times, and visiting them on a regular basis, making sure to document every interaction. Usually clients who have been giving you a hard time will find this a bit disconcerting and because you’re not a nameless/faceless collection agency, you’re not as easy to ignore. As a result it will usually result in receipt of payment.

Next week we’ll look into what steps need to follow these efforts if you still haven’t received payment.

_{Fred Daus is the Chief Executive Officer and founder of Fredrick James Accounting, Tax & Consulting. He is a member of National Society of Accountants and the National Society of Tax Professionals and has been helping clients save money and grow their income since 2001. Fredrick James is an innovative, full service accounting firm in Clearwater, Florida with a focus on providing outstanding service, tax savings and financial growth to clients in the Tampa Bay area, Nationwide and around the world. Visit our website www.FredrickJames.com or call 727-230-0716 for more information.}