Commercial billing

[MikeB]

How do you guys approach payment terms on commercial? Is 30 days pretty much expected?
I had one restaurant that I did monthly years ago that paid their bills every 2 weeks but I think most companies would expect 30 days.

[Derek]

hi Mike,

we don't have it worded anywhere on our Quotes or Invoices, but 30 is the norm for us and the vast majority of our Clients pay within that time frame. the few who don't, right around the 35-40 day mark i email them letting them know we haven't received payment and i tell them i am letting them know, in case it got lost in the mail.

they get the hint and usually apologize and get on it. one Client informed us they go 45 days out before payment, which was fine with us.

[MikeB]

Thanks Derek. I was just setting up my invoice system and it gives options for 15-30 and 45 I think. 30 is default setting. I can live with 30.

[FloorCareMD]

My invoices all state... $10.00 late fee after due date + 1.5% monthly.

Really don't expect anyone to pay the fee but if someone ever does not pay and I have to take them to court, it's there in print.
I have had some that decided to not pay but I did get paid later with some friendly persuasion. (low life independent pharmacy store owners). One guy actually said he was not going to pay and told me to prove that I stripped and waxed his tire shop vct floors. To make a long story short, I "repo'd" my hard work When he called to complain, I said to prove it, just like he told me. That was 20 years ago. He went out of business 19 years ago.

[TheCleaningDude]

At completion for one off carpet cleaning jobs.

If it's a regular client I offer 30 days, but they all pay completion anyway.

Jani are 30 days except one that is 60 days.

[David-Hebert]

First time customer COD after that 15 days net is my preference, 30 days is to long which leads to 45 way long. 15 days will get me paid in 21 to 30 My goal.

WE also require every new client to have a credit card on file so if they do not pay with in the specified time frame we can charge the card.

How I set it up On the invoice if paid by X date client will receive a discount of X for prompt payment. then the normal language stating payment must be made in 30 days or x % will be added to the invoice.

If we are asked how we want to set up payment my first choices are COD or Credit Card. Cash flow is king.

[NJP]

Nice thinking but I could never get my commerical accounts to pay cod unless it's a one time clean. Also I don't take credit cards. Cash or checks only .

[encapman]

I've always done it the way Derek mentioned above.
But I also like what David suggested too.
Lots of good comments here!

[David Edwards]

As an idea (and for discussion), what if we did it this way:

The first cleaning is always the most intensive, so there is an initial cleaning cost that is due at the time of service. Then, if the account is billed monthly, an invoice is immediately generated net 30. This way, you do (and get paid for) the initial clean and your next check is 30 days out - which, coincidentally, your next service is also 30 days out.

If billed/serviced quarterly, the same would be done except that terms would be changed to net 90.

Do you think that would be beneficial to your business and acceptable to your clients?

(It works great for my janitorial services, with no balking from clients - so I'm thinking the same principle, though modified, could work for carpet maintenance plans.)