Treasa Edmond: 0:00

Welcome to the Boss Responses podcast. Our special guest this week, L liz Heflin, brings 18 years of freelance writing and editing experience to the table. That experience translates to a solid understanding of the many nuances of running a freelance business, and she came on the podcast to share those with us. Today we take a look at what happens when you decide to work with a client in spite of those red flags that pop up sometimes. What do you do when they end up being difficult when it comes to paying for the work?

Treasa Edmond: 0:32

If you're a freelancer, business owner or anyone who deals with clients, you're in the right place. I'm your host, teresa Edmond. I've been dealing with clients and running my business for nearly two decades. Teresa Edmond, I've been dealing with clients and running my business for nearly two decades and in that time I've dealt with my share of doubt, imposter syndrome and not knowing what to say when a client asked a question I wasn't ready for. I created this podcast to empower you with the boss responses you need to grow your business. Each week, my guest co-host and I will bring you five episodes packed with practical insights. Monday through Thursday, we answer your questions, and Fridays we dive deep to explore how our co-hosts embrace their role as the boss of their business. Welcome to Boss Responses.

Treasa Edmond: 1:20

Liz, thank you for being here with us this week. I'm really looking forward to our conversations. I am as well. Thank you for being here with us this week. I'm really looking forward to our conversations. I am as well. Thank you for inviting me. All right, so let's just jump into day. One question, and I'm going to ask you this one. We are starting the week out with you.

Treasa Edmond: 1:35

When you end up taking one of those red flag clients that you know you shouldn't, and it goes as badly as you knew deep down it would, and you're not getting paid on time, what should you do? And this is the context they've given. The one time I got stiffed it was for $400, which isn't a huge amount of money, but definitely enough to really make me mad. And, of course, I had very much undercharged because I made every single new freelancer mistake with this client. Anyway, I repeatedly invoiced, contacted everyone I could find at the company, tried calling their accounting department and eventually talked to an attorney who wanted to charge $500 for a demand letter. In the end, I let it go, but I still wonder if there's something else I should have done.

Liz Heflin: 2:19

Yeah, this is a really great question and I should preface. I should say I've been doing freelance for about 18 years and I have only dealt with non-payment one time, but it was enough to learn a lot of lessons and to really feel the sting of it. So I was probably out about $3,000 by the end, which at the time just felt like this insurmountable amount of money and I was so devastated by it. But I so there are definitely things you can do. There are no, it's important to say right out of the gates there are no absolute, complete, 100% guarantees. There are safety nets that you can put in place to increase the odds that you will get paid and that you're not going to fall into the situation, but nothing is a 100% silver bullet. So first thing I would say is absolutely always work with a contract. That doesn't have to be something that you draft as a lawyer. It doesn't have to be full of legalese, it doesn't have to be like both parties signing on the dotted line. It can just be a written down description of the terms of the project, the pay rate and both people saying yes, I agree to this. If it's written down and you have those sort of three checkboxes. You have a contract, so it doesn't have to be official, but always operate with some written down record of what everybody has agreed to. That's one leg to stand on. So I do always like to operate with a contract. That's one. Then, once you have a contract, you can add some clauses that will incentivize clients to not leave payment on the table or not pay you late, so you can have financial penalties for paying late. You can have a little clause in there that says, hey, I retain the rights to this work until payment has been made in full. You can include a locked or a watermarked document to the client that they're not able to just right-click and copy and paste and get the text until payment has been made and then you can give them a clear copy that they can actually use. If a client's really motivated, they could probably find ways around that. But these are just deterrents, right. So those are all kinds of things you can do in the world of contracts to protect yourself. But again, we've probably all been there, even with a contract. I know when I didn't get paid I had a contract and it still happened. So there have to be other safety nets you put into place. So some of those are.

Liz Heflin: 4:49

For me and my business, deposits are big. I do not start work until some amount of payment has been made from the client and depends on the scope and the size of the project. But I typically do 50% upfront, 50% upon completion. But if you're getting red flag vibes or you're not really sure about the client, if there's anything that's unsettling to you about the deal, it is 100% within your rights to ask for 100% upfront. That's not unusual. If they balk at it, you can either have the conversation and decide whether that's a flag that they are going to be a non-paying client or you can open up the conversation and start negotiating.

Liz Heflin: 5:30

But deposits are really big. Not putting one ounce of mental effort or time or energy until some amount of money has been exchanged is really important, because it's just been my experience that if a client pays something, they will pay everything. The ones who are going to scam you outright aren't giving you a dime. So deposits are big. And then and this is a, this was a big one for me in the case where I wasn't paid I it was very early on in my freelancing career. I was very young. I started freelancing when I was about 18 or 19. So I was just a kid, you were a baby.

Liz Heflin: 6:05

I was just a baby and talking about money, having those conversations asserting myself with grown adults running their own businesses I didn't think of myself as running a business, even though I was, but that's not how I thought about it yet. That was really uncomfortable for me. So a big part of this facing the nonpayment issue is finding the confidence to get comfortable with the uncomfortable conversations and asserting your voice. And the second there's something that goes sideways a payment is late or it's partial when it should be full Any of these things that kind of start happening that lead to non-payment not being afraid to use your voice and to stand up and say no, no, no, Work doesn't continue until we get up to date. And part of that is just it's almost like aversion therapy Just the more you do it, the more comfortable you get with it. It's not something you just snap your fingers. And maybe there's some people out there who just are bored, able to have those conversations, but that wasn't me. I know that wasn't me. I had to get comfortable with it, I had to get used to it. So that's a really big part of it.

Liz Heflin: 7:15

And then, honestly, probably the biggest part of all is being really selective and careful about the clients that you work with. Yes, so that's really huge and I have built a lot of my business on referrals. That's just the way that it shook out for me. And so everybody who I was working with I wouldn't say everybody, but a lot of the people I was working with were people who came to me vetted, trusted. Hey, here's somebody I know from my networking group and he's a great guy and he wants a copywriter right. So working with people who come to you trusted, you don't obviously have to do that for every single client. Some people are going to come to you as inboundly, you know, strangers to you. But being really selective and careful about who you work with can really help because a contract, whatever the terms, are only as good as the person that you enter into that agreement with. So that's really a big piece of it.

Liz Heflin: 8:16

And listening to your gut when you feel like something isn't right about that client, that's a huge piece of it. You know, learning to trust that intuition and saying something's not right about this, that probably means something's not right about this. So picking obviously in this landscape, it's hard. Something's not right about this. So picking obviously in this landscape, it's hard to say be picky about your clients, because everyone feels like everyone's taking what they can get in this particular landscape. But it can really make the work more enjoyable.

Liz Heflin: 8:44

Make sure those payments are made on time all of that good stuff and then just not bending on those boundaries and rules, even if it's a client that you know and trust. The person who didn't pay me had paid on time every time, in full, for years and then that stopped and I bent my own rules because I knew them and trusted them, and on and on, and at the end of the day you're running a business and if the payments stop coming in, you have to stop that bleeding as soon as you can. So if I had put my foot down, I probably would have walked away with a couple hundred dollars in missed invoices, but I didn't and I was stuck with several thousand dollars that ended up never getting paid.

Treasa Edmond: 9:32

So yeah, that's a big part of it For me, that one that was a mindset shift the I know this client, I trust this client, we've worked together for a long time and that's one of the biggest things for me. I agree with everything you said and I have just a few things that I'll add to a couple of them. But with that, when you're working with an existing client and they stop paying, one of the ways I gained that confidence to have that conversation was making it not about me. It's not about me, it's about my business. You're not paying my business and I don't get paid by my business if you don't pay my business. So ultimately it's about me. But right now this is about my business and I really do use that neutral terminology and that seems to set clients back a little bit. They're like I thought she was going to take this personally, but no, she's not. This is a business thing and for some reason that I don't know why that works to get payment a little bit more, but it does. Another thing I found and this is really only applicable to the female part of the audience, but it is a thing Women have a harder time getting paid than men, and I don't. It's a disrespect thing. I don't know what the issue is. Whatever the issue is, it happens and it's not always just for male clients and I found a really sneaky workaround very early on that has worked 100% of the time.

Treasa Edmond: 11:00

I have a fake mail colleague. He is set up and I change his name periodically and I still use him. Sometimes he's set up on my work email. Sometimes his name's Mike, sometimes it's Zach, Sometimes it's always like a power name and all it ever takes is him sending one email saying Teresa's passed this invoice over to me to collect payment. And here are the terms this is what you agreed to. The payment is now this many days past due. The dude gets the payment and it's the most bizarre thing, and I only pull him out in absolute emergencies, but it happens. It's. And it's the most bizarre thing, and I only pull him out in absolute emergencies, but it happens interesting it's and it works.

Liz Heflin: 11:43

I think there's a part of that too that the sometimes the threat of a third party is. And I don't know if it's, if it's a male, female thing, but I know I part of this is okay. I'm trying to chase down payment. If I use a lawyer and make this a legal issue, I'm out more than I'm gaining. So you can feel really powerless in that way. But sometimes just the threat of legal action is enough to light a fire under people, even if you have no intention of pursuing it, because obviously you're not going to spend $4,000 to hunt down $400. That doesn't make sense. But just saying we will need to escalate this to legal terms then sometimes that can push the final lever.

Treasa Edmond: 12:28

Yeah, and you mentioned the clause about maintaining the rights to the work and doing the watermark. I use an invoicing software called Hello Bonsai, and I love it. One of the major benefits of that, though, is for that final invoice, because I'm like you. I always ask for at least 50% upfront, and then they have that final invoice. Usually that final invoice, the project is attached to it, and it's not released until they make that payment, which is very handy, so I love doing that, but I also, at one point, probably about 10 years into running my business, I had the opportunity to buy a templatized cease and desist notice, and because back then, I wasn't requiring a deposit and I had a couple of people who paid very sluggishly, they paid, but it was pulling teeth, and I had that read through by a lawyer. So it's a lot cheaper to have a lawyer read through something than it is to have them write it, and I had them make sure everything was right for my state and for the laws and all of that stuff, and I'll just flat out send that.

Treasa Edmond: 13:36

I've tried to get the invoice three times. I see that you're using the work already. This is an official cease and desist notice. I maintain ownership of that and I will be contacting. This is the kicker, though. I flat out say I will be contacting search engines to have the content removed because of copyright infringement. And the second you say that they're like pay the person because no one wants that ding. No one wants that ding. Yeah, so I've found and I hate dealing with that issue ever it is totally a mindset issue. It's not something it's not pleasant, right? Yeah, it's not, but it's part of running your business and you have to do it with confidence, even if you fake that confidence for five minutes. You have to do it. And confidence, even if you fake that confidence for five minutes you have to do it and find what works for you Absolutely fine.

Treasa Edmond: 14:22

But the being selective about clients is when all of that changed for me and I found out that the more I charge, the less I have issues with clients who 100% of them are paying.

Liz Heflin: 14:35

Such a good point. That is such a good point. The nickel and dimers are the ones that you are chasing down invoices. Oh, I'm not going to say 100% of the time, nothing's 100% of the time, but the vast majority of the time. That's exactly right. The ones who are paying a fair to great rate, they're the ones who pay the day you send the invoice, or before, or before, or before. I have the real angel clients out there who are paying before Peace.

Treasa Edmond: 15:03

I had a client for ghostwriting which is a hefty fee and I always charge 50% of that, and then it's 25% milestones, so 25% halfway through the book, 25% upon completion. And I had a client come to me and it was, like I said, a very hefty fee and I'm like here's the payment terms. It's 20 or it's 50% upfront, and then these, and he's like I don't want to deal with this, can I just send you the whole thing? And I'm like, okay, I suppose that would be okay.

Treasa Edmond: 15:34

Sure, and that was after I raised my rates, because I wasn't sure if I even wanted to do ghostwriting anymore. So it works, you find your way, and it's never just about payment. It's never just about payment. There are always other factors at play, and if you get all of those factors figured out in your business, then payment's just going to be a lot more smooth. So that's a killer day one, liz A lot to talk about in non-payment.

Liz Heflin: 16:01

Yes, I mean that probably every freelancer has had to deal with, so it's an important topic.

Treasa Edmond: 16:07

Well, thank you for all of that wonderful, wonderful advice for our listener and come back tomorrow, everyone for day two with Liz, and we're going to talk a little bit about niching down and whether or not it's necessary.