3 tips to get a friend to pay

I’ve done business with a friend and they’re not paying – What do I do?

Friends pay each other

Most people start in business by trading with their friends and family. Once you get more established, you start charging them and then they don’t pay, what should you do?

Based on nearly 20 years experience in credit control, here’s 3 steps to try I’d suggest:

1 – Send them a statement

By sending them a statement you are showing them this is a business transaction and giving them a written notification you expect to be paid. It show them that you are serious about payment in a very nonthreatening way. They don’t know when you normally send statements, or how frequently, so pop one in the post and see what their reaction is.  It also reaffirms your Invoice Payment terms and shows you know about this side of your business.

2 – Ask them politely why they haven’t paid

This sounds really obvious, but did you tell them when you wanted paying?  What’s the worst they can say? Either they will say “I’ll sort it” or “I’m not paying”, if it’s I’m not paying you need to address the issue of why. You don’t have to make the whole conversation about getting, talk about things they are interested in and make sure they realise you are interested in them as well as getting paid.  Ask them if your invoice payment terms weren’t clear enough on your invoice. Use this friendship to help you get things right for future customers.

3 – Send them a default notice
If you completed steps one and 2 above and your friend still hasn’t paid you, then I would recommend sending them a default notice, or a Final Demand Letter. Again this shows you are serious about being paid and also that you are treating it a business transaction. It sets out your expectation of when payment is needed by in order for you to not take any further action in getting payment and thus helping to keep the friendship whilst reminding them, you aren’t made of money.

All though step 3 may seem harsh, sometime you need to remind people that yes they maybe your friend but when you have done work for them and that work is your income, they need to pay you.

Good luck with it and hopefully you won’t need to take anything further than step 3, however if you do, or you just want some advice at any stage, don’t hesitate to tweet me @RChivertonLtd or send me an email.

More hints on making the most of your invoice can be found in my free e-book, just head to http://rachaelchiverton.co.uk/ complete the form and follow the steps to obtain your free copy.

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