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Collections? How long to wait?

Discussion in 'Commercial Snow Removal' started by Peterbilt, Apr 26, 2008.

  1. Peterbilt

    Peterbilt Senior Member
    from IA.
    Messages: 745

    I turned over a customer to collections on friday.

    The business owes me for Jan, Feb and March. Over $3200.00

    I have a serious moral delima Here. I have done work for them before (Landscape repair) The bill was close to the snow removal amount and they made payments to me for 3 months. And we talk during this time quite a bit.

    I always personally hand deliver thier bills (So I know they get them) But after 3 months and 2 now all 3 not paid, I felt I had to do smoething.

    I have also stopped in to visit on a few occasions and left my number for them to call back. With no call backs.

    Its not that I need the cash here, But if the roles were reversed I would be getting the same treatment from whomever I owed money, regaurdless of situation.

    This is the first time I have ever had to do this and I feel like crap about it.

    The other thing is I have a business to run here. Its a small business but I am still extremely busy with spring coming on and i can't be everywhere and doing everything all at once. I just don't have time to do over-due payment collection on my own. I need to focus on bringing in new work and making sure the current work is going the way it should.

    Any opinions here guys?

    Last edited: Apr 26, 2008
  2. iceyman

    iceyman 2000 Club Member
    Messages: 2,521

    screw em'..... u need your money too......did u try to talk to them about makin payments again?
  3. toby4492

    toby4492 2000 Club Member
    Messages: 2,513

    Don't feel bad about it as you are running a business and should be paid timely for services rendered. It sounds as if you have done all you can and have been plenty patient with them in my opinion.
  4. Peterbilt

    Peterbilt Senior Member
    from IA.
    Messages: 745

    I offer to trade them for a Sno-ex 1875 sand pro the they don't use anymore, They him-hawed about still needing it and didn't agree to the suggestion. But that was also in January (While I hande the owner the bill)

    The only thing I haven't done is call them. I feel the personal stop ins should have been enough.

    The other thing is I like the owner. He's a good guy in my eyes. Small family owned/employed business.

    I was also warned about him not paying bills by a large company I sub for. He owes them over $8000.

  5. Camden

    Camden PlowSite Fanatic
    Messages: 6,594

    I don't blame you for doing what you did. I try not to use collection agencies because they take such a big cut of the bill. Around here it's 50% :cry:

    And I can certainly relate to your frustration about not getting paid on time. One of my biggest accounts is a major US corporation and up until this week I had only received one check for the entire winter.

    I feel like I'm at their mercy because my invoices are sent to Rapid City, SD so it's not like I can just stop in and chat with someone. :realmad:

    I guess dealing with this sort of thing is just part of the job...
  6. Silentroo

    Silentroo Senior Member
    Messages: 147

    We have a fairly large account. Everyone in town knows they are a slooooooooooowwwwwwwww pay, It is not just snow. it is everything they do. Couple of things to remember.

    1. If you wait until May you loose all bargaining power. It is amazing how quick I see a check before a big storm.
    2. We worked a 15 day out in the contract if they are over 30 days. This means that if they are more than 15 days pass due, we can walk on the contract.
    3. We stay on top of them. At 31 days (30 is the term) we start contact and hound them.
    4. Document every conversation and send a follow up email . Something like we talked on 3-19 about a check to cover invoice #1944 for $3500. It should be received by 3-25.then contact them 3-26. This will do two things; Squeeky wheel gets the grease. second it confirms receipt of invoice and removes the ever popular it was not preformed argument.

    Finally it is all business. My subs will come after me if I do not pay, My suppliers will come after me for the same. It is business.
  7. Sno4U

    Sno4U Senior Member
    Messages: 480

    "its not that I need the cash" thats probably part of your regret in turning them over to collections. Tell ya what, if you really don't need the cash can I have it??!!
    WE all have to pay our bills and WE ALL NEED our cash!! So-go for it and get what due to U.:realmad:
  8. rfed32

    rfed32 Senior Member
    Messages: 473

    u did the right thing...u need to put food on the table...and if u have subs u already paid them so ur out the money...imho u def did the right thing...im not sure if u did it or not but i would have sent them a letter say i am turning this over to collection on 05/05/08 if you dont pay me by then type of deal...give them the heads up and that would help out a lil bit i think scare them a lil and they might pay
  9. NorthwestPlower1

    NorthwestPlower1 Member
    Messages: 57

    I would scrap the collection service and research your states lien laws. Better yet find a lien service.(I got a great one in Illinois) It is far more effective. A professional lien service should do a title search and notfiy any mortgage companies or banks that have stake in property. Once they get the letter of intent they will call the owner telling him he better pay the bill. Read and follow the laws of your state and you should get your money. It may take awhile but you will get paid he won't be able to sell, refinance, or payoff his property until you are paid. And depending on your state laws you may be entitled to interest while you are waiting for payment.
  10. Ramairfreak98ss

    Ramairfreak98ss PlowSite.com Addict
    Messages: 1,885

    how does one go about hiring a collections department :p I would love that, now i currently have to go to court everytime people choose not to pay :/
  11. Camden

    Camden PlowSite Fanatic
    Messages: 6,594

    It's very simple. Just call an agency and tell them your situation. If they think they can make money they'll take it on and if not then you'll have to find someone else.

    They're going to take a LARGE cut of any money they collect so be prepared for that.
  12. SpruceLandscape

    SpruceLandscape Senior Member
    Messages: 248

    I have four customers that are currently turned over to collections. Ranging from amounts of only $75 to $870. Its not that $75 will kill me, its the fact that I signed a contract along with them, I held up my end of the bargain which was to be ready 24 hours a day to make sure they can get in and out of their drives/lots no matter what the weather is doing or what is going on in my life. I have missed many a good nights sleep with my wife, or spending time with family on holidays to uphold my end of the deal. All I ask for , and this goes for you as well, is to be compensated in a timely manner as they agreed to from the start. What would of happened if you would have waited 3 months after the snow fell to come plow thier lot? I'm guessing they wouldn't be very understanding about that now would they?:realmad: I will make phone calls and send friendly to harsh collection letters of my own once a bill is 15 days past its due date (which is 30 days from the day its sent). After that I send them one more to let them know they are going to collections. If they haven't paid you or started paying you within 45 days, then they have to intention. Simple as that. What would happen if you didn't pay your cable bill for 3 months? They shut it off! Do you think that this customer of yours is not paying thier cable bill? I'll bet they are... Thats because they don't NEED your services anymore at this point in time. Send them to collections, pay the 30 percent collection fees and that way you can move on to making money instead of worrying about dead beats all the time. Its better to get 70 percent of what you are owed and not waste your time chasing old bills so you can concentrate on your current work load at hand. Good luck:drinkup: