When you don’t have a typical 9-5 and are in the freelance world, you won’t be getting a steady paycheck every two weeks. That doesn’t mean you can’t have an incredible successful career. As you go from gig to gig and contract to contract, you will build your rep which will give you justification to raise your rates. However, since the money is coming from various people through various methods, you need to stay on top of these payments. You make agreements in contracts but not all clients pay in the timely as they should, so you know the terms in which you should receive payment. You will get paid faster if you:
Establish the right contact. Make sure you have the right contact at your client for requesting invoices and payments. If you’re working with a larger company, it may be an individual from their accounting department. Especially if the main contact at your client is a creative or product manager type, get the A/P contact. Busy creatives don’t have paying bills at the top of their priority list. Establish up-front who may be the best person to contact to follow-up on invoices, etc.
Know their system. Some companies (especially large ones) have very specific processes for paying their vendors. Venture one micron off that system and you may not get paid for months. These include, but aren’t necessarily limited to: having a purchase order (PO) and/or job number on your invoice; having an invoice number to give them; if your fee is broken into multiple payments, you may need a specific invoice for each payment; submitting your invoice in time to make the company’s check run; do they have certain invoice amounts that require a higher level of management to approve or sign (this is huge as submitting that full invoice for $5,000 vs. two invoices of $2,500 each could mean the difference of getting paid in two weeks vs. eight weeks).
Set the stage. Make it clear up front what your payment terms are so you can go into the relationship with expectations correct.
Make it easy. Make it easy for your clients to pay you. Some clients may be able to pay with a credit card. Give them that option. You can use Paypal to accept all major credit cards (no Paypal membership is needed by the payee). If you don’t want to eat the credit card transaction fee (usually around 3%), pass the fee on. For payments of $500 or more, we charge a 3% transaction fee when invoices are paid via credit card. They always have the option to pay via check to avoid the fee. At least 50% of the time, clients just pay the transaction fee.
Follow up. Have a process to follow-up on invoices owed you. Maybe you send an email or two first. Then follow-up with a phone call. But do follow-up. Sometimes companies will purposefully sit on a check until you ask for it. They’re managing cash flow just like you. So, if you’re not asking, they may say, “Great. They obviously don’t need it right now. I’ll pay this other guy who keeps calling.” The squeaky wheel gets the oil.
Be courteous and professional. It goes without saying, don’t be a jerk (e.g. “Yo. Where’s my money gee! Don’t have me come down there!”) I know you may WANT to say that, but hold your tongue. Always be overly courteous in all communication. We all agree money can be an awkward topic, so don’t make it more awkward with a poor attitude.
Consider using a VA or bookkeeper. I know many of you are small businesses where you wear most, if not all of the hats. Consider hiring a virtual assistant or bookkeeper to help you collect funds. It alleviates you having to personally make those awkward calls or emails, and it also makes you come off more professional when you have a “department” that handles accounts receivable.