We’ve also learned this lesson the hard way. These are now the clauses we require in every project we do:

- Payment is due X days after receipt of invoice, or immediately after the consultant has addressed any quality issues, whichever is sooner

- Late payment shall incur interest at 8% above the BoE base rate and a late fee of 100 GBP as per the UK Late Payment Legislation. Partial payments on invoices shall apply to late fees, interest, and then principal, in that order.

- In the event of a late payment the invoice for the next deliverable shall immediately fall due.

- The consultant shall be entitled to shift deadlines on deliverables in the event of a late payment as a result of any work disruption, without incurring any liability.

- Payment shall be made in X currency, or an exchange rate at X date on Oanda.com shall apply.

- The client is responsible for any bank fees incurred by their, or any intermediary bank. In the event of a SWIFT transaction it shall be made with the OUR payment code.

- The jurisdiction in the event of a conflict shall be England and Wales. Neither party shall be bound by arbitration.

- The client and consultant shall both indemnify the other up to the total value of the contract and shall not under any circumstance be liable beyond X GBP.

We also no longer share downloadable links of our deliverables until they are paid up. They get a view/comment only link for reports/data etc.

We’ve found that clients that aren’t willing to accept these terms won’t pay you either way.

We determine the net days on the invoice based on the credit rating of the client. Ironically, the good clients pay within 2-3 days normally, and the difficult ones are very “long tail”. About 1% of contracts tend to fully or partially default on their payments.

We’re in a particularly credit poor industry but our average delay due to late payment is 23 days. Those clients where we stop delivery pay on average 11 days sooner than those contracts where we don’t stop delivery.

This is based on around 2,000 invoices sent over the last 5 years.

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eckesicle 8 hours ago | parent | next [-]

Oh and another lesson! Ensuring that each deliverable invoice is small enough that it falls under the simplified claims procedure (in the UK it’s 10,000 pounds) greatly simplifies collection.

It costs something like 80 quid to file for recovery in court and in our experience invoices are immediately paid up when a “Letter before action” is sent.

You burn the relationship, but arguably you probably don’t want it anyway.

	▲	ilamont 7 hours ago \| parent \| next [-]
		> simplified claims procedure I believe this is what we call small claims court in the United States. The threshold varies by state, but it is a very effective way to deal with recalcitrant companies both large and small.
	▲	8 hours ago \| parent \| prev [-]
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veunes 7 hours ago | parent | prev | next [-]

I think the hidden advantage here isn't even enforcement, it's filtering

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fmx 7 hours ago | parent | prev | next [-]

> Ironically, the good clients pay within 2-3 days normally, and the difficult ones are very “long tail”.

Why ironically? Isn't that exactly what you'd expect?

	▲	anonymars 6 hours ago \| parent \| next [-]
		The ironic part is that the clients that don't need the looser payment terms (more time to pay the invoice) are the ones that get them Kind of mirrors "it's expensive to be poor"
	▲	moron4hire 3 hours ago \| parent \| prev [-]
		I took "good client" to mean, "is easy to work with/communicates well/knows what they want", not just "pays on time". The inverse being, the ones who don't pay on time were already a pain in the ass to work with.

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k2enemy 4 hours ago | parent | prev | next [-]

> - Late payment shall incur interest at 8% above the BoE base rate and a late fee of 100 GBP as per the UK Late Payment Legislation. Partial payments on invoices shall apply to late fees, interest, and then principal, in that order.

Do you mean 8 percent, or 8 percentage points?

	▲	eckesicle 3 hours ago \| parent [-]
		The exact wording in our contracts and the government guidance is “8% plus the Bank of England base rate”. They mean “percentage points”. https://www.gov.uk/late-commercial-payments-interest-debt-re... As I understand it, from our lawyer, is that this exact wording is automatically enforceable in UK courts and easiest in the event of a dispute. It’s also generally internationally accepted.

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yellow_lead 8 hours ago | parent | prev [-]

It seems like none of these terms would have saved OP though

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QuarterReptile 7 hours ago | parent | next [-]

I think OP needed "emergency service is cash up front".

In a different domain, this is the painful lesson of almost anyone who tries to help people in a bind -- you can try to help, but yours is unlikely to be the advice that sets them straight, so you shouldn't get too invested with unproven or, especially, proven unreliable actors.

	▲	doctorhandshake 7 hours ago \| parent [-]
		>> "emergency service is cash up front“ Neatly distilled I believe you are correct

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ufmace 5 hours ago | parent | prev | next [-]

It's worth keeping in mind that the only practical "saving" for the OP will result in not doing the job at all, since this client most likely doesn't actually have the money and never will.

It should be, oh, short-term rush job in a foreign country for a sketchy client? That is most definitely cash up front time. Oh, you can't afford that? Sucks to be you, not going to do it.

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7 hours ago | parent | prev [-]

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