Fun Business Fun Money Podcast
EP 048 – You deserve to be paid on time
When is the appropriate time to be paid?
NOW. Up front and on time.
But unfortunately thats not always how it works out.
This quick tip episode has some insights into why certain types of clients will resist your payment terms, and what you can do to strengthen your payment terms.
TRANSCRIPT
Hey there, and welcome to the Fun Business Fun Money podcast!
If you’re listening in real time its Thursday 8th of June, which means its a quick tip episode, and this one isn’t just for you, the amazing online entrepreneur, its also for the general people out there who you want to have as clients.
Something that has come up a few times recently in conversations with clients and in comments I’ve seen on social media is – when is the appropriate time to be paid?
The obvious answer is now, up front, immediately, because why would someone agree to work with you if they don’t have the means to pay you?
But its not always that simple.
As an employee the norm is to be paid for the work you’ve just done, whether its weekly, fortnightly or monthly. Monthly pay is often two weeks worked, two weeks in advance, and paid in the middle of the month. It differs between companies and countries, so don’t come at me if you have something different!
I’m not a fan of monthly pay, I know theres a ton of reasons why its a good thing, but it simply doesn’t work for everyone. Running out of money before the next pay cycle is a very real thing for a lot of people these days.
Now if you’re a business that serves corporations or any kind of large business with employees, you’re possibly going to come up against the employee approach.
Thats how they pay their people, therefore thats how they want to pay YOU. In retrospect.
I always hated seeing overdue invoices with reminders coming through in my corporate career, bringing it to the attention of the ones authorising payment, and being told “we’ll pay it when we’re ready.” Basically its a collect the money quick from those who owe you, and pay it out real slow to those you owe approach.
For that company or business, its a win win, they get to keep ‘your’ money in their account a little longer, which boosts their numbers while at the same time, there you are stressing over when you’ll actually be paid and when it might happen.
This is NOT how the world should be, especially with services in a digital world.
As an entrepreneur or business owner, its a very different situation. All too often people will hire you, expect the work to be done and they’ll pay once they see its completed as agreed. Which is fair from their perspective.
But what ISN’T fair is expecting solopreneurs, small agencies, small business owners or consultants to put in hours and hours of work with zero money upfront, on the promise that they’ll be paid at the end.
Those people have bills to pay, mouths to feed, mortgages to cover, just like everyone else. In fact, their overheads may well be MORE than what an employee might have, simply because they’re investing in the tools, tech and support services needed to make their business run in the first place.
If you’re looking to hire someone to complete some work for you, whether its a physical product, a service with a tangible outcome like tradespeople, or someone like me who offers an intangible service with a transformation as the outcome, make sure you’re giving the terms of their contract with you the respect it deserves.
As a business owner its ok to ask for a deposit up front, and to make it a decent chunk of the overall payment. You have materials to buy, time to invest, you deserve to be paid for this regardless of the final outcome.
Its also ok to ask for payment in full up front, people really shouldn’t be offended by this.
Have a solid refund policy in place and make sure everyone understands what happens if the work isn’t able to be completed in the expected timeframe, or the end result isn’t what they expected.
Managing expectations through clear communication is so powerful!
If you’ve had an awkward situation around being paid, or note being paid on time, you need to work on managing expectations by clearly communicating the terms.
Business owners HAVE to implement strong boundaries around their work and payment terms, either because they’ve been screwed over in the past, or because they’re fully aware of the potential for that to happen through other people’s experiences, and they’re taking steps to minimise that happening for themselves.
If you’re wanting to hire someone to fix your problem, maybe a website needs some work, copywriting needs done, don’t disrespect them by demanding you pay on YOUR terms – or by not paying at all.
And to the lovely solopreneurs, business owners and agencies… make sure you set your boundaries around money by being clear and direct about your terms. Don’t do the work until your payment terms are agreed and met.
Thats my hot tip for this week, you deserve to be paid up front and on time. Be confident in asking for what you’re worth.
Take care, have fun, and I’ll catch you in the next episode!
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