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We have a client with overdue invoices. He is waiting to be paid by someone else. How do we offer an installment payment arrangement? What would be a good timetable for it?

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Pragya Tandon
Title: Director of Finance
Company: ClearVoice, Inc.
(Director of Finance, ClearVoice, Inc.) |

We have a similar client who isn't obligated to pay us until he gets paid by his client. I just have my Accountant to keep following up with the client so they are aggressive at their end to collect from their client.

Do you have anything in the contract with your client that calls out that they don't need to pay you until they get paid at their end? If yes, then there isn't much you can do except continuing to follow up with your client to create the urgency. If not, then you don't have to wait and can offer a payment schedule based on their projected collection period from their client. It all really depends on how flexible your cash flow is, how flexible your client's cash flow is, how good a relationship you have with your client, if this is going to be a one-time thing or an on-going arrangement with the client. Lots of variables.

EMERSON GALFO
Title: CFO
Company: C-Suite Services
LinkedIn Profile
(CFO, C-Suite Services) |

I am assuming this is the duplicate thread of an earlier post ? Check my answer to that thread. Get the invoice/receivable (or part of it) pledged/assigned to you.

Gary Honig
Title: President
Company: Creative Capital Associates Factoring Co..
LinkedIn Profile
(President, Creative Capital Associates Factoring Company) |

"Paid when paid" is the term commonly used for this situation. Pragya is correct, if this term is used in a contract then you can only wait.

Generally, small business owners need to start thinking more like a bank. When you finish a contract and submit an invoice you are now lending money to your customer, for the most part interest free. So who are you lending money to? And what are the terms of the loan? - Is the customer creditworthy and are there strict net term days associated with the invoice?

In this case if you are not operating under a paid when paid contract you might impress your late paying customer to go out and get their own financing to pay your bill rather than relying on your kindness.

You might also use the notion that you will start contacting credit reporting agencies like DnB and Experian to report the late payment.

BL: Never lend to anyone who can't afford to pay.

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