Customer Wont Pay??

[future_electrical]

Hi Everyone,

My name is Jordon Goodwin, Director of Future Electrical Installations Ltd. I have being trading now for a little over 6 months and today have run into my first block of confusion(you could call it)

Before Christamas we have done an installation of Security Alarm and CCTV cameras, to a quoted and agreed price by the customer of £1250 (£1500 including the monitor i supplied.)

I have recieved many compliments from the client over the quailty of the cameras, had a few issues with the alarm codes nothing major.

I invoiced the job on January 6th 08. Over the last couple of days i have being calling the customer trying to organise the payment for the works completed- obviously no joy. I suppose because of my nagging the customer has demanded i ripped the installation out because he has decided not to pay me. This is a problem for me, i have layed out £898 + vat worth of materials.

Can anyone give me some advice to as what my next move should be. If more details are required please mail me.


Kind Regards



Jordon Goodwin

 

[malcolmX]

sue him. Did you sign a business contract?

 

[Shay]

I am no legal eagle but if he has signed a contract then he would be rather stupid to do so. I am guessing because its not over 5k, small claims court would be your best route, that way you say solicitor costs and can add the cost of the claim on to it, so I would go for the whole amount and not the 898+VAT.

A letter stating your intention and a date to start your action should have them squirming enough to pay up.

Having said that I would wait for someone who has had this problem before to give you the thumbs up. Good luck.

 

[becker]

Go and have a meeting with the client. Go with an open mind and be willing to reach a compromise.
Most businesses agree that payment on invoices is due within 30 days from the date of the invoice or within 1 month from the end of the month the invoice was issued. Your "nagging" within a few days of issuing the invoice could have pissed them off. Go with the intension of putting things right. Possibly offer to discount the system further in order to retain the client and any possible good will.
As a last resort - the equipment is still yours - take it back. Especially if the customer doesn't want it. You could only sue them if they wanted to keep it and not pay. Also, the legal costs would be greater than the £1500 of the installation.

 

[Cred-X]

How frustrating.
I have seen exactly the same problem (alarms and cctv) before.
I don't see why any supplier should have to compromise or have to make a loss of any kind just because a customer takes offence at being chased for not paying an invoice that they are legally liable to pay in the first place.
Credit is a priviledge, not a right.
If the "customer" (i use the term losely) is getting narky because he is being chased then I would guess that he never intended to pay the full price when he ordered it. Now it's in an installed he wants to haggle. Either that or he has seen something better on offer somewhere and realises that he has ordered the wrong thing and wants you to carry the can for his mistake.

Contract or not, you are fully entitled to issue proceedings in the small claims court and that is what I would recmmend you do.

 

[becker]

It would be better to loose a few pounds keeping an existing customer happy and willing to recommend you, than to go nuclear on them and risk getting a bad reputation, which would spread quickier and wider than a good one.

 

[RayB]

It would be better to loose a few pounds keeping an existing customer happy and willing to recommend you, than to go nuclear on them and risk getting a bad reputation, which would spread quickier and wider than a good one.

With respect I don't agree. IMO opinion you can't get a bad reputation for expecting people to pay for something they contracted you to provide.

Indeed, by losing out financially to appease a crooked customer you are more likely to obtain a reputation for being soft/a pushover

 

[becker]

I'm not suggesting that anyone be a push over. I'm suggesting that rather than incur additional expense in either removing the equipment, legal fees, etc, etc and also the unquantifiable lost opportunity expense, discuss the situation with the client and try to sort it out. Part of sorting it out, might involve biting the bullet and offering a good will gesture.

If any customer is just trying it on, then stick it to em!

 

[Shay]

If its small claims cost, the fees aren't that expensive and could be added to the claim should the customer not wish to pay up before proceedings start.

Not sure I would let anyone get away with it, I run a business not a charity.

 

[malcolmX]

But you should not let people take advantage of you. If he agreed to have system installed, agreed to terms and conditions, he understands that he has to pay. He wanted it after all. You have to take care of customer and so people, but you gotta stand up for yourself and get whats belongs to you - hes a time waster and pain in the butt, so to hell with customer service here - he said the guy was happy after all... here in US he would be sued the next day, trust me on that

 

[An Oasis]

It would be better to loose a few pounds keeping an existing customer happy and willing to recommend you, than to go nuclear on them and risk getting a bad reputation, which would spread quickier and wider than a good one.

You will not keep this type of customer happy the are the equivalent of professional time wasters, we meet them all the time, "oh well what we really wanted was"... Or 2 months after a job has been completed "we don't really like this" Or and this is the best to date "...our tortoise is struggling to walk on the gravel you laid you need to take in up and put down gravel that he can walk on". Idiots total morons.

Give them written notice stating that failure to pay is in contravention of your T&C's and then take them to the small claims if they fail to pay.

 

[becker]

If its small claims cost, the fees aren't that expensive and could be added to the claim should the customer not wish to pay up before proceedings start.

Not sure I would let anyone get away with it, I run a business not a charity.

... and part of running a business (or a charity) is that sometimes you need to lose a battle in order to win the war. Given this situation it might be possible to keep the client, get some extra business from them and claw back any 'good will gesture' several times over.

 

[becker]

..... here in US he would be sued the next day, trust me on that

We are all too aware of the litigious culture of the US.

Its one cultural difference many of us wish the UK had not imported.

 

[Shay]

I appreciate that but from what the original poster has said this client doesn't sound like he would give him the time of day let alone referals.

 

[estwig]

Rip your kit out, wear the lose, learn from the mistakes and move forward.

Death to all the punters!!!!!

 

[malcolmX]

At the end it all comes down to a buck. If your customer isn`t paying you - thats a lost war, as fas as i`m concerned. You can take extra steps to make him happy, or spend extra time teaching him, but business is business.... if you dont get paid, you lost your war as a businesmann, and people will be taking advantage of you all the times. respect people and be nice, but stand for yourself and dont work for free.

... and part of running a business (or a charity) is that sometimes you need to lose a battle in order to win the war. Given this situation it might be possible to keep the client, get some extra business from them and claw back any 'good will gesture' several times over.

 

[Conceptstore]

"If the "customer" (i use the term losely) is getting narky because he is being chased then I would guess that he never intended to pay the full price when he ordered it."

Cred Ex is right.

I had a similar situation last year and the client never intended on paying the full amount. Luckily i requested a deposit before starting the job which i kept but i did not get paid in full.

Send a final warning invoice and if their is still no pay, just go and take the system out. (You own the system without a full payment). You may be down a few pounds but you should be able to use the equipment for another job.

They won't give you bad publicity as they probably don't have a leg to stand on themselves, they are probably known for doing that sort of thing.

Be cool, be calculated. For every job you loose, you gain three Take it as experience, you'll become a better business for doing so.

 

[stuart miles]

I feel for you, I think you should seek legal advice, im sure you would have a good case for small claims court.

We see on tv
builders from hell, rouge traders etc - why not CUSTOMERS FROM HELL there are just as many out there!

rgds
stuart

 

[estwig]

We see on tv
builders from hell, rouge traders etc - why not CUSTOMERS FROM HELL there are just as many out there!

All too true!!

 

[future_electrical]

I would like to thank everybody who has posted me back on this issue. I think it is probably best i write this guy a letter requesting he pay within say 14 days? or i will seek legal advice to close the matter. I dont fancy visiting the guy in person, i had a rather threatening voice mail the other day, my life is worth more than £1500. I will post him a letter then get back to you all with the out come. Once again i am glad you could all help me in your own ways.

 

[estwig]

Good luck mate and don't give him 14 days, make it 7 days.

 

[Wiggy]

Get a lawyer to do the math for you.
Are your chances of winning good enough for the investment in time and effort?

If not, cut your losses, take back your gear and chalk it up to experience.
Personally, I wouldn't open negotiations for anything other than payment in full, but this is because I would rather lose money than see crooks win. [This is not sound business advice]

It is a pity folks in the building trades don't have a secret mark they can put on the pavement outside premises where the occupants are poor payers, to warn off others. . .

 

I always find in this type of situation it is best to take a step back before doing anything rash.

OK, only you really know what this 'customer' is like and what they appear to be wanting, but maybe not going in all guns blazing might be a good move.

Run this invoice through normal credit control procedures and chase it with reminders, etc first.

If that doesn't work, ask your solicitor to write you a letter, as a final demand - they should only charge buttons for this, if at all (or maybe we have pretty decent ones over here).

Once that fails, then pursue this through the small claims court, ensuring they are informed that additonal charges will occur.

Do not roll over to this, you are entitled to your cash - they certainly don't do their work for nowt.

Hopefully it will get resolved when the idiot (oops I mean customer) calms down a little.

 

[vanboy]

You've supplied the service/goods,the customer does'nt seem to be saying theres a problem with the work you've carried out,you are therefore totally within your rights to demand full payment.I personally don't think going and removing your equipment from the customer's premises is a good idea - i could see a situation arising when accusations against you of damage to his property during the removal process could be made and you could end up in the County Court!.Send him a 7 day letter outlining the work you did,cost of said work and demand that he settle within 7 days,or,on day 8 you will fill in the online C.C.J forms and post them immediately to the County Court (i know some colleagues that send copies of filled in C.C.J forms with the 7 day letter to show they mean business!).Whatever you do,every communication by post to the customer MUST be done by registered post - they can't say they did'nt receive it then!.PS - apparently if payment terms are not discussed initially,then payment is due immediately on completion.Good luck!.

 

[Matt1959]

no one has said why the client doesn't want to pay apart from a supposition that he's hacked off cos you are chasing a cheque.

Why doesn't he want to pay and why does he want it ripped out exactly when he was happy with it in the first place. Have you asked him?

 

[Xteach]

reading all the threads and advice I would like to add my bit.

first of all is there a way to make the situation into a good one, gain back customer confidence and future orders with recommendations.

If he is in financial trouble chasing the debt would get his back up, maybe ask would he pay in installments, that way you get your money, he doesnt feel threatened, the lawyers get seen off.

why do you reckon he changed his mind? that is unclear by your threads.

if he is threatening you get it taped, report him if it goes further than you would like.

taking the stuff back to me wouldn't be an option, I would go to small claims court if it got that far.

get advice but in my case, I in the past have sent letters to bad debtors stating that unless payment in full is received within 7 days I will issue proceedings to reclaim the debt adding an additional charge for recovery of £xxxx not including solicitors fees to the final bill (they tend to pay then)

one other thing we do for all customers now is ask for a none refundable 50% deposit prior to commencement of work with all goods fully owned by us until payment in full, this guarantees the customers interest and helps cashflow. the great thing for them is they have 50% bargaining power ensuring we do an excellent job.

 

[maxine]

Hi Jordon,

Think there has been some good advice here and agree with Cred-x that you probably weren't going to get paid for this from the outset, but unfortunately you have to think about what to do now.

The bit about removing it really depends in my view on what you have in your terms and conditions and be wary that you could run risks if you cause damage as Vanboy has said.

Taking what you have said I would suggest writing a very strong letter before legal action (7 or 14 days up to you) saying that you require payment in this time frame before you take legal action and then follow that up. If there are any reasons for non-payment then the customer can always defend the claim and then you can decide whether you wish to continue.

Out of interest, is it worth you taking the equipment away? How much time and effort is involved? Do you make much of a loss on the value of the goods? Would you levy an "un-installation" fee as part of your contract to at least cover your losses so far?

I wouldn't say that you would damage your business reputation because of non-payment of a client by taking the goods away. I think that is a sign that you are not a push-over!

oh, and we do have a secret sign for customers from hell but it wouldnt be secret if we told you all ha ha

Max

 

I fully sympathise with the OP, but his slight overzealousness in collecting monies due may have exasperated the customer somewhat, nonetheless a job was done as agreed and there is a debt. he may wish to browse http://www.payontime.co.uk/doctor/doctor_main.html

 

[Peter Bowen]

Can I add a couple of points here:

1. You don't want repeat business from this customer. It's the old 80/20 rule. 80% of trouble come from 20% of your customers. Get rid of them.

2. You should be spending your time and energy on that which makes money.

3. There is a cost to removal of the equipment and there may be some practical difficulties to that. Also second hand equipment has lower value than new stuff.

4. You need an internal debt collecting system which starts at the contract stage and ends with payment or handing the debt over for collection. You can find a simple one here: http://www.nomore247.com/systemize-your-cash-flow.html

Cheers

Pete

 

[gibby]

some good advice here

personally I would visit the client to find out what the problem is.
Sounds like the guy is skint so going for a CCJ could be chucking your money away as he probably wouldnt pay or pay in small amounts

if after a visit you cant find any genuine reason why he wont pay send a registered letter stating that 1 you will arrive on such a date to remove the equipment and state that you will charge to do so, at a reasonable rate of course & include rental for the time its been in

This way you get the gear back & can chase up money for your time.

I find the threat of a small claim court is actually better than using it.
Send an official looking letter stating 14 days for complete payment or the matter will be passed to the SCC for collection.
State all fees & legal expenses & interest will be added to the total amount and that you will be instructing bailiffs once judgement is complete

As Ive mentioned the small claims court is often a total waste of time and money as if they have no money to collect you cant get it.
Often if they dont pay you need to instruct bailiffs which cost yet more money and if the guy lies to them and says he is no longer there then you need a PI to prove he is there - more money

I did CCTV for a while & found it better to get a leasing or credit firm involved so customers could pay monthly & you get paid in time
if customers default its not your problem.

Hope you get it sorted

G

 

[future_electrical]

Hi folks i have literally tried to call this guy to try and get round to see him to sort things out, on the phone i couldnt get a word in edge ways, apperently he has had the locks changed on his house, and enformed a solicitor of my action ( to remind you i have kept hold of his back door key in exchange for payment ) so now he wants me to goes through a lawyer to get to him, i am getting tired of this and its only just started. He claims that his baron house with no plaster etc, no lights, no gas, no electricity!!! He is now claiming that he will ruin me, because since i have completed the installation there has got dust in his computer etc. Should i still continue my quest for payment. The situation as i see it is, he rang me requesting the work completed, i completed the works to a standard i class as high, all four cameras, dvd and monitor were working correctly (after many hours of adjusting the cameras to suit his requirements) then the alarm was installed and working, only thing that was to do was for him to change the code to his personal one.

Also he is refusing me the materials back!!!

Does everyone agree i am in the right???

 

[estwig]

Yes you are in the right mate and I am very sorry to hear of your troubles, I do not wish to sound patronising but, I have been there many many times.

You have to give him his key back straight away, your only remaining course of action is either small claims court, they have a very good online service, a solicitor or walk and forget it.

Small claims is probably your best bet as the cost is minimal compared to a solicitor.

Learn and move forward.


Death to all the punters!!!

 

[Xteach]

I agree, take him to court.

 

[future_electrical]

would anyone proof read a letter for me if i mailed it??? i aint good with letters and want this one to be perfect.

I LOVE THIS PLACE, WE SHOULD ALL DEAL WITH EACH OTHER, SURELY THEN WE WOULDNT HAVE ANYTHING TO COMPLAIN ABOUT!!!!

 

[estwig]

Go on then mate send it over, done far too many of these myself and happy to give you pointers, but your English had better be good or they will laugh at you.

 

[gibby]

sounds like this guy does this a lot
if he has gone to the extent/expense of changing locks etc then he is a con artist

I would do the following asap to lessen your damages & avoid any more delay tactics - I think/know court action & solicitors letters will cost you more money

visit his premises during working hours with some hefty friends, as many as possible & take away your goods
do this asap as he may sell them or move them & as they have not been paid for he could do this at any time
you are in the right & if he gets nasty & threatens to call the police - the only thing he can do tell him to do so as you are in the right

take the equipment away asap & still bill him for the time it takes to take it out and any other reasonable charges
one thing you can do is inform any customers that come into his premises this is what he is doing & that he is not to be trusted

I know its not nice but guys like this exist and eventually go out of business

I did for a very short spell help someone with their marketing for their business & ended up spending most of my time stopping debt collectors & bailiffs from taking goods away
the amount of gear he had on the premises that he hadnt paid for or not willing to pay for was amazing and he even screwed me for a couple of K
when I got him out of debt
he did go under & joined herbalife & started ripping off others for a few grand a time with herbalife.

sorry I cant give you more hopeful advice - or you can just move on & let it go

G

 

[estwig]

gibby.., you haven't got a clue!

That is seriously very bad advice.

 

[gibby]

excuse me - Ive never come across anyone so offensive on this forum

I ran a cctv company for 3 years before I sold it
I never installed anything until we had a 50% deposit & had a finance or leasing agreement in place

on one occasion the finance co made a mistake over the agreement being made as the small trader was a dodge pot & gave us the runaround very similar to the story here

we went in & took the equipment out & the guy went nuts but as I had 4 guys with me he had no choice - it turned out another local firm went through the same crap with the same guy - but he sold there gear on


This trader is owed money and his "customer£ knows how to not pay
going to the small claims court will most probably be a waste of time as this guy will claim he has no money and pay peanuts monthly & probably default

Ive also carried out the same action on major hotel chains for similar problems


I suggest nicely you disagree in a more polite way infuture

G

 

[maxine]

Hi Jordon,

Sorry to hear how this is going but my advice is to keep this non-confrontational and use the small claims court. He has not previously advised of any disputes or areas of dissatisfaction up until your requests for payment.

If you want to PM me with your letter, I will happily proof read for you free of charge of course and it would also help if you could PM with a copy of your terms and conditions.

Regards
Max

 

[Wiggy]

Whoa. . .

My head's with Keith on this one but my heart's with Gibby. . .

I agree completely that chasing him through legal channels is probably a waste of time. I was done by a crook [alleged builder] years ago and my home insurance employed lawyers to chase him. . .Could they get a thing? heck no! Even his car was in his wife's name. . .

Problem with the heavy approach is that I suspect the police will take his side if they arrive in time. . .All he has to do is deny knowing you and you become a violent burglar in the eyes of the police. I don't recall you mentioning that you have his signature on the quote or T&C. . . Also, many of these posts infer that the premises in question are business premises but I can't see where this info comes from, in fact, the OP states

apperently he has had the locks changed on his house, and enformed a solicitor of my action ( to remind you i have kept hold of his back door key in exchange for payment )

Sounds like a home to me. . .I would tread carefully with the heavy approach, all it takes is a heavy to fend off a hysterical daughter [or son of course in the spirit of PCness] and you are suddenly in a different type of mess. . .

I fear that this may be a 'chalk it up to experience' moment. . .