finding clients who are convinced you can do whatever you want to sell.
Find clients who need what you want to sell and convince them is the solution. It's not easy and in my experience they won't all be convinced (some ever) but if you can provide what you're selling then clients only need persuaided enough to pay a deposit, first payment or some other initial small invoice and trust/capability will be build/demonstrated when first building clientele. Once you have more work than time raise your rates as high as you can without decreasing your earnings. Then if you can get to step 7 hire a convincing sales person first.
I don't know if this is a cultural difference or something, but in the UK no client will ever pay a deposit on an invoice for consulting work. I normally get paid within 30-90 days of the work being done (it sucks)
Possibly is, my experience with a few current London based clients in my day job is often recieving pushback and delays on any initial deposits or pre-payment. Holding firm that the clearly defined payment terms are a prerequisite for work commencement has been the most effective approach, even if it involves some uncomfortable emails or meetings. Polite but firm push back on a clients reluctance is very often sucessful even if momentarily uncomfortable.
I'd suggest to try proposing reasonable payment terms as soon as possible, terms that are as favorable to you as they may or possibly are willing to accept, and upon discussion (or a note included in the proposed terms) respond that an initial deposit is a firm requirement before commencement of any billable work, but you are flexible and willing to discuss a customized draw (payment) schedule if it's required (or.. you're not willing). You may be surprised how many clients will accept your terms, even after declaring them unacceptable, once you (re)affirm the terms as a firm, mandatory requirement. Willingness to walk away is often a strong, persuasive signal of competence and/or high demand of your service and can provoke decisions to be made more promptly by potential clients.
You can factor an intrest charge for payment delays that will encourage prompt payment, calculate by percentage and then format your payment terms to represent these differences as discounts for prompt payment instead of penalties for late payment. A secondary benifit of using these now slightly increased rates combined with prompt payment discounts is that you will be able to slightly increase your effective rate for recurring clients by adjusting these discount amounts in the event you can't or don't want to propose a higher rate. Also, IME (in the US) the initial disclosure of late payment terms or penalties may be a requirememt when including compounded interest on an outstanding debt amount in a situation where legal action to recover debt becomes necessary.
As tptacek mentions Net-30,40,50,...90 are all common terms, you should expect and plan for longer payment windows and more term flexability as invoice amounts increase. An advance from an invoice factoring company is an available option, you could price this into your rate at a default of Net-60 and offer a Net-10 and Net-30 discount based on factoring cost.
Same here. Although there is often some flexibility with smaller companies it is seen as unprofessional to ask for a deposit up front. An alternative approach is to break the work up into smaller chunks and have the payment for those resolved before continuing. For example (as someone mentioned above) an initial assessment of the issue, or making a project plan could be one of the first steps that provide the client with something of value and at the same time show you they do pay on time.
With large companies in UK unfortunately the payment terms are what they are (usually 30 days after invoicing in my case). If you don't like it, they'll find someone who does. It is up to you to decide if the higher rate they are able to pay covers the cost of the delay.
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Anybody here that did it that way and succeeded?
In my opinion the main road-blocks are finding clients who are convinced you can do whatever you want to sell.
Find clients who need what you want to sell and convince them is the solution. It's not easy and in my experience they won't all be convinced (some ever) but if you can provide what you're selling then clients only need persuaided enough to pay a deposit, first payment or some other initial small invoice and trust/capability will be build/demonstrated when first building clientele. Once you have more work than time raise your rates as high as you can without decreasing your earnings. Then if you can get to step 7 hire a convincing sales person first.
I don't know if this is a cultural difference or something, but in the UK no client will ever pay a deposit on an invoice for consulting work. I normally get paid within 30-90 days of the work being done (it sucks)
Possibly is, my experience with a few current London based clients in my day job is often recieving pushback and delays on any initial deposits or pre-payment. Holding firm that the clearly defined payment terms are a prerequisite for work commencement has been the most effective approach, even if it involves some uncomfortable emails or meetings. Polite but firm push back on a clients reluctance is very often sucessful even if momentarily uncomfortable.
I'd suggest to try proposing reasonable payment terms as soon as possible, terms that are as favorable to you as they may or possibly are willing to accept, and upon discussion (or a note included in the proposed terms) respond that an initial deposit is a firm requirement before commencement of any billable work, but you are flexible and willing to discuss a customized draw (payment) schedule if it's required (or.. you're not willing). You may be surprised how many clients will accept your terms, even after declaring them unacceptable, once you (re)affirm the terms as a firm, mandatory requirement. Willingness to walk away is often a strong, persuasive signal of competence and/or high demand of your service and can provoke decisions to be made more promptly by potential clients.
You can factor an intrest charge for payment delays that will encourage prompt payment, calculate by percentage and then format your payment terms to represent these differences as discounts for prompt payment instead of penalties for late payment. A secondary benifit of using these now slightly increased rates combined with prompt payment discounts is that you will be able to slightly increase your effective rate for recurring clients by adjusting these discount amounts in the event you can't or don't want to propose a higher rate. Also, IME (in the US) the initial disclosure of late payment terms or penalties may be a requirememt when including compounded interest on an outstanding debt amount in a situation where legal action to recover debt becomes necessary.
As tptacek mentions Net-30,40,50,...90 are all common terms, you should expect and plan for longer payment windows and more term flexability as invoice amounts increase. An advance from an invoice factoring company is an available option, you could price this into your rate at a default of Net-60 and offer a Net-10 and Net-30 discount based on factoring cost.
Same here. Although there is often some flexibility with smaller companies it is seen as unprofessional to ask for a deposit up front. An alternative approach is to break the work up into smaller chunks and have the payment for those resolved before continuing. For example (as someone mentioned above) an initial assessment of the issue, or making a project plan could be one of the first steps that provide the client with something of value and at the same time show you they do pay on time.
With large companies in UK unfortunately the payment terms are what they are (usually 30 days after invoicing in my case). If you don't like it, they'll find someone who does. It is up to you to decide if the higher rate they are able to pay covers the cost of the delay.
30-90 days is pretty normal, and what you should probably plan for if you're doing high-dollar consulting.
I mean, yeah, for whatever that's worth.