Every Friday I share reader comments from earlier in the week. Today I’m featuring a comment from a reader who responded to my Wednesday post, Getting Paid On Time.
Here’s the story Rachel from Third Degree Glass Factory shared:
“A few years ago our company had a client who didn’t pay her $1700 invoice balance until the day before the event. She gave us a credit card number over the phone, we ran it, and it went through with no problems, so we didn’t think anything else about it — Until a few weeks later when Visa called and said we had made a fraudulent charge on someone’s card! The day AFTER her son’s birthday party, our client called Visa to say she never authorized the charge and they took it off her account and NEVER paid us! (Not to mention, made us look horrible! As if we were stealing our customer’s credit card numbers!) We tried contacting her but she never returned our calls or letters. We tried to take it to court but found out that she had given us a false address, so serving her papers was hopeless (she failed to appear twice.) We finally resolved that we would never see that money. And while for some it may seem like a small amount, when you’re a small business $1700 adds up!
Now, we require all invoices to be paid in full 30 days prior to any event. Even if a client is unsure of guest count or additional charges, I will take the majority of the payment ahead of time so checks and credit card charges can clear. We also require any credit card payment NOT made in person to supply us with a filled out and signed credit card authorization form (a simple Word document, converted into a PDF that we can email.) This way we will always have signatures on file for every single charge. Our merchant services account has said that nothing is better than a “real” signature, but an authorization form is enough to show consent and will usually hold up in court.
I understand that planning an event is stressful for the client, but as a business, we have to protect ourselves.”
I’m so impressed by how Rachel handled this unfortunate situation and that she has managed to ensure she’ll never be in that situation again.
Dear Readers, thanks for sharing all of your opinions this week. Have a great weekend!