Feedback on payment timeline misunderstanding

Storefront
1

So I recently had an odd situation develop with a newly acquired business account.

The owner had us in to quote a fairly sizable restaurant, stating her previous window cleaner is based out of town and it’s difficult to get on their schedule.
I bid it at $175 in/ex, sent her the quote, insurance info etc. I specify on my business quotes 7 day payment windows.

She accepts the quote, and asks us to walkthrough another property with her, a large 3 story building. During the walkthrough she is ripping her previous cleaner pretty good. I was a bit leery of the situation at this point, but I don’t know the other company, maybe she had just cause for being dissatisfied.

We clean the initial business for $175, send her a quickbooks invoice, again with the 7 day window clearly shown.

She doesn’t respond, but again, not everyone does that either; folks are busy. However she also never opened the invoice link.:man_shrugging:t2:

As a part of daily operation, I send reminders after 7 days, nothing pushy; general platitudes, the weather and greetings followed by a quickbooks link to their invoice.
Often I’ll either get an apology for the delay or some sort of general acknowledgement. Obviously a business account here or there that’s late isn’t a make or break, we’ve just found reminders beneficial because like us, business owners are busy and things get lost in the frey sometimes.

So I send this to the business owner, on the 10th day after the service: (10th because it’s been a crazy busy fall)

"Good morning [name],

Hope your week is going well and you’ve had a chance to enjoy this sunshine. Please find attached a copy of your window cleaning service invoice.

Thank you for your business, and have a great day!"

I just received this in response, no greetings, this is it in its entirety:

"Are you not like our other vendors that give us net 30 terms to pay invoices?
You were just here and you’re already sending me a reminder to pay you?

[Name]"

I’m a little taken back by the tone change of what should be a simple and relatively cordial business relationship. :thinking:

I believe I’ll respond tomorrow with something in the neighborhood of this: "Good morning [Name],

Thank you for the response. I apologize if there’s been a misunderstanding.

We are actually not a vendor; we are a service provider. Industry standard and our company policy are payment within seven days of service completion, as noted on your invoice dated ____.

We appreciate you sharing your expectations and preferred business practice with us. In this case we’ll make an acception for you, thirty days will be fine; thank you for replying.

Have a beautiful week,"

I am well aware businesses take a while to pay in many instances, not a shock, name of the game. However I’m not a fan of customers trying to “big time” me or speak down to me; I put things in writing to avoid these situations. I’m wondering though if I’m missing something?

I’m open to thoughts, suggestions…:thinking:

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Oof !! Lol … ya that’s Ruff ! Many ways you can go with this. I could give you a couple , but you’ll lose the account. So let’s just keep it.

Here’s your reply … for me atleast.
Hi …, sorry it’s just standard procedure we send out a reminder after the net we have set in the computer. We will change it to 30 , Sorry for the confusion. see you at the next service.

It is what it is. She sounds like a winner. Good luck with this one. Ya that would leave a knot in my stomach. It’s going to be hard to take the high road , but if you want the account you’ll have to.

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A few things.

1 - you seem like a nice guy who really takes the time to care about his customers, so please don’t take any of my feedback as anything other than trying to help you out.

  1. Mike is right on this. If you want to keep this account you need to take the high road. She has an expectation of 30 days, and that is quite common for most areas. In This I would say your the exception in this case and I wouldn’t expect people to read the due date. In the future I would verbally point it out and clarify if they can do that. Some corporate accounts only process their checks once a month, so no matter what you put on the invoice they will process it when they normally do.

  2. I would not correct her on what she calls you unless vendor in your area has a universal negative connotation. Its unnecessary and will just engender bad will.

  3. This lady seems like a pain! I would verify verbally and put everything in writing (not that you didn’t already have it in writing) in the future that are any changes to your current agreement, and I wouldnt do anything extra for her as she likely won’t appreciate it.

  4. If you decide to keep her, I would thank her for her business and taking time out her busy day to respond to you. If you haven’t already, I would read/listen to “how to win freinds and influence people” by Dale Carnegie. I am doing that now and I don’t know why in the world I didn’t sooner. My sales are likely going to be so much better, and my relating to people has already gotten better, and I’m only have way through the book.

As a side note, what did she complain about with her other cleaner?

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I am up front verbally a couple of times at the onset that I don’t do Net 30. On a monthly account they are always 30 days in arrears. There are a few jobs I have missed because of that, there are also a few lucrative jobs that I land in spite of requiring 7-10 days payment.

I feel like the Freelancer who insists on “No Net 30”. I had one arrogant business piss me off to the point I said - “Go ahead and submit to Accounts Payable request for payment, and in 30 days when the check is ready give me a call and I will put you on the schedule ASAP. You get your 30 days and I get paid in a timely fashion.” Yea, he didn’t go for it - I didn’t care, as he was also my farthest out to drive to customer and I replaced him with two more Quarterly Residential jobs.
I’m not in the business of extending credit, sorry.

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Thank you for the feedback and suggestions @Majestic66 @Chargingsnail @Garry

Thought I’d share how it all shook out.
I landed on this as my response:

"Good morning [name],

Hope you’re having a good friday, (may be the last sunshine we get for awhile. :sun_with_face:)

We usually have net 7 terms for our business accounts here in town; it’s noted in your “invoice details.”

But no worries, in truth I sent the reminder to you the other day along with a group of 9 other businesses our program noted as past 7 days.

I’ve adjusted [Name] to 30 days, so you won’t receive another reminder until then.

Thank you for taking the time to respond; my apologies for any misunderstanding.

Have a great weekend!"

She replied 15 mins later:

“Good morning,
No worries! Thanks for taking care of that for us! I will let you know as soon as we are ready for you at the depot building!
All the best,
[Name]”

Bipolar maybe? :man_shrugging:t2:

But also makes me think of what my grandpa used to tell us kids when we were fighting, “A soft answer calms ill temper. A harsh word brings out anger.”

In any event, she’s gone down several pegs in my book; that’s no way to do business. Foolhardy and arrogant.

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I’ve posted about this several times in the past. If you want to swim in the deeper end of the commercial pool, get used to Net30. Its a pain at times, but it is the way they do business. Residential is usually pay upon completion. Some guys like Garry are crystal clear on their stand and that’s fine. To each his own.

But if you want to do the bigger jobs or work for the larger companies, get used to it.
And if you fight it with them - just be aware of how your business looks to them.

Its like demanding payment in cash. Or asking they make out the check to you personally not to your business. It just sounds dodgy to them.

Same with saying that you can’t live 30 days without the $175. It says you are living hand to mouth and barely surviving. Which may be true - but don’t ever show that weakness to the customer. It gives the appearance of swimming with floaties on your arms.

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@Endless Im glad it worked out! Sometimes people just get stressed, though it sounds like she may have a quick temper, idk. As long as she pays you within a few days of the net 30 and its profitable, then in my book usually thats a keeper. I have a few large companies that wait the full 30 every time to pay, and then some sometimes. (Usually 33-35 :rage:) But, they always pay and its recurring work, so I just have my expectations set.

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I’m with you as long as they come I’m fine, an they always do. My payables come every 30 days too. Then in goes the checks , an out goes the bills …lol it’s a viscous cycle :rofl:.

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Haha, I know what you mean! Some months the gross looks great but my bank account doesn’t quite look the same. The profitable months usually come around when someone gets sick, or just when we decide to do a house improvement. :rofl:

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I respect your experience in that market, and appreciate the candor; I agree with you, net 30 terms do grease the wheels of cooperation with larger businesses. (As seen in what happened to me above.)

However I feel I’d be remiss if I didn’t point out, the perception of net 30 terms equating to legitimate business practice and anything else equating to poor business practice seems to be an over simplification.

Your branding, advertising pieces, insurance, uniforms, business systems, letterhead, google pages, facebook page, website, professional demeanor, prompt customer service, etc, are generally what makes you stand out as professional.

If someone is relying on their net terms to make or break their professional presence, they probably shouldn’t be near the deep end to begin with.

It has very little to do with Money, $175 can come in and out in a breath without most of us knowing it, doesn’t matter. It’s having another business dictate your terms of service.
This company sought me out; then wants to play king and dictate terms and boarder line insult me with insinuations while sitting in their little fiefdom of supposed superiority as chief potentate.
Just a bit much when we’re talking $175.

That said, obviously I relented; very little to do with the money, everything to do with upholding a reputation of proper business practices. Even if they have no interest in doing the same.

However if we’re talking actual companies, with actual money on the line, ($1,000+) I’d say being flexible and attentive to their preference in terms would be most appropriate.

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The trick to me is not have an abundance of Net 30 , so your not dependent on this income
That goes for this whole business. I think a balance is needed. Storefront , Commercial , Residential. You choose the percentages.

Maybe you wan to be 20 % Storefront , 60% residential, an 20% commercial.

Residential is always clean an get paid to me anyway. I have a few that send a check which is fine.

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Let me correct that statement. A balance isn’t needed , but it’s nice. In my eyes.

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On the other hand it in fact is extending a line of credit to certain folks who always want to be one month back on payment to some how think they are cheating the game. If a big company can’t make their bills, what does that say about them? :wink:

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I get it Garry. But I have also worked in accounts payable and receivable for a large corp. Its just the way business is done. If I work for a restaurant chain, Im just one of the many vendors they pay. Food delivery isn’t often paid upon delivery unless there is a history. Landscape guys, liquor supply, the guy who changes out rugs and uniforms, etc. They all provide weekly services and likely get paid at the end of the month. The accounts payable department waits until all invoices are in and then cuts one check per vendor and has them signed. They arent necessarily saving money but time. If they had to run and cut a check and have it signed for every vendor, every week they would get nothing else done. Trust me, I’ve done it - its a hamster in a wheel feeling trying to keep up with every invoice that hits the desk.

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I appreciate your points. I think you are dealing with two things tho - Net30 and a rude, condescending customer. If they pay cash, but are creeps - drop them. You are correct about not liking their attitudes.

Net30 is just the cost of doing business. Its built on a measure of trust. Just like the many expenses in our personal life that we pay for after receiving the service - utilities, phone services, credit cards etc.

Dont misunderstand me. I love cash in hand or a check. I have had to chase customers and have had some go Chapter 13 and left me with the invoices. It stinks.

But I also have customers that pay faithfully everytime and I have built a good income off of them. If I drop them because I dont want to wait, there are 10 other companies wanting the job. Leverage isn’t in my hands unfortunately.

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“Net 30” billing trap.

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Part 1 and 2 of the link @Garry posted above is worth every second of time to read it.
Enlightening for a number of reasons; I won’t spoil the read, but here’s something that struck me the hardest:

Billion dollar institutions, banks, credit card companies etc, won’t loan you or your business a cent without running a background check.
And yet with net30, that’s exactly what you’re doing.

Loaning money to a business without doing a background check. The kicker is you’re doing it INTEREST FREE. I hold business funds in high yield accounts for a reason. (apy is admittedly crap at the moment, but it stands to reason.) And that’s to say nothing of what that money could be doing for you if invested in some form or fashion.

Just a great article.

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I actually have all but given up my storefronts, and not just because of covid. I’ve added pressure washing which will be very profitable, and on my best day I had trouble making the same per hour as some of my worst days on resi. Thats mostly because I’m too much of a perfectionist on storefronts and I know thats not the name of the game, but I want my quality to be consistent. I’m thinking I’m going to be more pressure washing than wc in the next year or two with a 70% resi, 30% commercial mix.

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Honestly my friend seven days is too short. Send a notice after two weeks if nothing is received. But expecting payment after a week seems rushed. We give people a month before we start to stress it. Being flexible and easy to work with is a key.

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“Easy and flexible” goes both ways. I doubt that accounts payable just assumes the terms, instead they ignore what is written on an invoice. They simply CHOOSE to force their way onto others. That is why I verbally explain up front as I CHOOSE to force them to acknowledge my terms. Most assuredly now with this global pandemic and businesses are folding - 30 days from now and :::POOF:::