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Running a Micro, Podcast · September 11, 2014

A Customer Doesn’t Pay Your Micro Business. Dollars and Sense Show #25

You are here: Home / Running a Micro / A Customer Doesn’t Pay Your Micro Business. Dollars and Sense Show #25

DollarsSenseShow25

Show #25 What to do when a customer doesn’t pay your Micro Business.

In this podcast, Carol Topp offers tips to micro business owners on what to do if a customer doesn’t pay you.

LISTEN to the podcast

runningmb_medThis information is covered in more detail in Carol Topp’s book Running a Micro Business

 

 

 

Most of your clients will pay when you hand them a bill, but sometimes they forget or do not have a checkbook with them. In those cases you need to remind them.

  • Send another copy of the bill, statement or invoice. Email is a good reminder or use regular mail if you must. This usually does the trick. Most people are forgetful and not out to cheat you.
  • Call the customer and ask if they received your bill.
  • If a customer is late paying you, do not do any additional services for them.

 

Payment Policies for Micro Businesses

After you’ve been running your business for a while, you will come up with some payment policies that work well for you. A few common payment policies include:

  • Ask for some money up front as a down payment. This is a common practice if you will be doing a large job for a customer. It is very common to ask for a small amount, perhaps 10-20% of the total price before you begin work.
  • Progress payments. Ask for payments as you do each part of a large job. For example, I asked my graphic designer to do five tasks for me. He billed me after three tasks were complete and then again when the job was finished.
  • Charge a late fee for customers who are more than 30 days late in paying you. Your late fee can be a percentage of the total cost (5-10% if customary) or a flat fee such as $10.
  • Have a policy regarding bounced checks. If a customer pays you with a bad check, your bank may fine you when the check is deposited. It may not seem fair, but it is a common practice. You, in turn, should charge the customer at least a $10 fee to cover your bank fees. Some stores charge as much as $25 for bounced check.
  • Consider marking up your price to accept Paypal or credit card payments. Paypal and credit card companies typically take 2-4% of the payment as their fee. Most business owners usually consider these fees as part of doing business, so make sure you take the fees into consideration when pricing your products or services.

 

Join Carol’s other podcasts for micro business owners on Creating a Sales Presentation and Making the Sale.

Learn more about starting and running a micro business at MicroBusinessforTeens.com

 

 

 

Related posts:

  1. Making the Sale. Tips for your Micro Business. Dollars and Sense Show #24
  2. Creating a Sales Presentation for your Micro Business. Dollars and Sense Show #23
  3. Dollars and Sense Show # 1: What is a micro business and why is it such a great idea?
  4. Dollars and Sense Show #2: Finding and testing a great idea for your micro business
  5. Dollars and Sense Show #3: What a business plan can do for your micro business

Filed Under: Running a Micro, Podcast Tagged With: Carol Topp, Dollars and Sense Show, Ultimate Homeschool Radio Network, micro business for teens, podcast, sales

Carol Topp, CPA

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From a parent

Thank you for your e-book on teen micro businesses. Your valuable experience and wealth of knowledge is vast.

Your presentations at Cincinnati homeschool conferences and sharing with us over the years have benefited us well.

I can hardly believe we are at this point in our life-and here he is a young man ready to try his fortune with the world.

-Mandy S

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