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  • #16
    If you have contract customers, do you bill them monthly? and if so, do you ever bill for the previous months cuts or are they always billed and paid prior to cutting?

    I was thinking for customers who sign at least a 3 month contract, that I would bill them at the end of the month and have it due by the 10th of the next month. Too risky?
    I think monthly is good for the down economy.

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    • #17
      I bill on the first of each month for that months service, with payment to be made by the 15th of the month. It has worked out very well and I am not out a lot of service if a client can't pay. I also have a lot of clients that have insisted on giving me post dated cheques 6 or 12 months advance. I really like that option, never an issue knowing your not getting paid. I've never had a client's cheque bounce, thank goodness for "lil old ladies".

      For our one time services/clients, they are billed once service is performed and same rules apply ... 14 days to pay. Most of these clients want to pay once your done anyway, so it has never really been much of an issue for me.

      Lloyd
      Blue's YardFX
      Camrose, AB

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      • #18
        I've never used a contract but we collect as we mow. It has absolutely saved the spring cash flow issues. When I ran my business years ago, we did the usual billing at the end of the month. Spring was way too expensive for me by doing that (expenses keep adding up until money starts flowing in about 7 weeks later) and I think any new folks in the business NEED to look at keeping cash flow by either collecting the day of the cut or (as some here do), collecting in advance. I even tried billing twice monthly (15th and 30th) but my customers hated it. If our payments / bills crossed in the mail, they were confused and were constantly adjusting what was actually due. We did it for a few months and dropped it.
        We are 100% pay as you go since last season and it has been a life saver and probably the most positive change our company made.
        New lawn companies...........you NEED to be able to cash flow your business and customers paying NOW will save you tons of issues.
        Hope this helps someone out.

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        • #19
          All this info is a big help. Probably will collect as service is performed, at least at the beginning.
          Thanks for all the input.

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          • #20
            Mcscapes bills advanced monthly but the customer sets up the day of the month there due, I don't claim to know what my customers bills look like but the first is a load for a homeowner so let them pick whats good for them. We haven't had a problem with customers paying but we do have some that forget and that's why I'm here to remind them. Business isn't just about you doing a good job it has a lot to do with what kind of person you are, there are times when you need your customer to work with you the same should be done for the customer. Thanks for listening BRIAN

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            • #21
              Last year I lost about 13% of my income because I would bill after work was performed. The problem I ran into what that I was doing about 4 cuts, before they got the bill. They didn't look at the bill for a couple of weeks, and before I know it, they are 2 months behind, and I'm out a lot of money.

              This year I changed that. I bill in advance. I'll either drop of an invoice a week before the new month (the last cut of a month), or the first week of the month (the first cut of a month).

              With new customers I tell them I bill in advance, and no one minds it. If someone were to ask why, I would tell them I lost a lot of money last year, and our policy is the customer either pays at time of service, or in advance. But no one asks.

              Another trick I decided to do this year, is to bill for a full month in advance, even if it is in the middle of the month. This way, if a customers lawn needs a lot done, and it's something that my full service would cover any ways, they are paying for it. I don't need a customer wanting full service at the end of the month getting mowing, edging, trimming, blowing, weeds sprayed, fertilizer, etc, for only a few bucks because it was the last week of the month.

              Then what I do is prorate the next month. So if a customer signs up to pay, say, $100/mo (an easy round number to work with), but they do so in the middle of a 4 week month, they still have to give me $100. But next month they are only billed for $50.

              I explain that to them as well. And no one has a problem with it. I mean, what happens if you put a ton of product and work into a lawn, but they cancel 2 weeks into the service?

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              • #22
                Then what I do is prorate the next month. So if a customer signs up to pay, say, $100/mo (an easy round number to work with), but they do so in the middle of a 4 week month, they still have to give me $100. But next month they are only billed for $50.
                That is an excellent idea.

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                • #23
                  Last year I lost about 13% of my income because I would bill after work was performed. The problem I ran into what that I was doing about 4 cuts, before they got the bill. They didn't look at the bill for a couple of weeks, and before I know it, they are 2 months behind, and I'm out a lot of money. ...
                  I don't understand how you are out the money.
                  Boughter's Lawn Care Services Mowing and Fertilizing in New Castle, PA

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                  • #24
                    I don't understand how you are out the money.
                    I'm out the money because they didn't pay. If I bill the customer at the end of the month for $100/mo (again, an nice even number) they already own me for the entire month. If they don't pay that, I'm screwed, I can't undo what I did.

                    Now, the customer takes a few weeks to even think about paying, and what happened with a huge chunk of people, is they just didn't pay it. I already did the service, so I'm out the money. And that will be like $200, because I dropped off the invoice at the end of a month (instead of the beginning) and kept servicing the lawn waiting for a check.

                    But, if you bill ahead of time, the worst you will be out is 2 weeks of service (around $50). Because you could make sure all invoices arrive by the first, and have them say they are due by the 15th. If you don't get money by the 15th, you don't do their lawn.

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                    • #25
                      I'm out the money because they didn't pay. If I bill the customer at the end of the month for $100/mo (again, an nice even number) they already own me for the entire month. If they don't pay that, I'm screwed, I can't undo what I did. ...
                      If they don't pay after the first invoice do you just give up?
                      Boughter's Lawn Care Services Mowing and Fertilizing in New Castle, PA

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                      • #26
                        I collect from my customers the day of the cut. The only ones that get invoices from me are the Commercial accounts. The residential all leave me either a check or cash on the door, or are home when we come. I found it's way to easy to put a bill to the side and conveniently forget about it, take the dead beats to small claims court to get your money thats owed. Hopefully you had them sign something before they became your customers, like an estimate of the work you will perform. Once they sign the estimate, it's a binding agreement.
                        http://www.lunchesruslawncare.com

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                        • #27
                          ... I found it's way to easy to put a bill to the side and conveniently forget about it ...
                          Don't you use the Gopher software?
                          Boughter's Lawn Care Services Mowing and Fertilizing in New Castle, PA

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                          • #28
                            Don't you use the Gopher software?
                            Yes I do use the Gopher Software. I rely on it more for the scheduling than the monthly billing. I input payments each day at night as I close out the day before I print up the next days work sheet. I just don't want to make it easy for my residentials to conveniently forget about paying me. I only invoice my commercial accounts at the end of the month. This way, I always have cash on hand, since I have way more residential than I do commercial. I could not function and pay employees if I had to wait a month and half to 2 months to get the money flowing.
                            http://www.lunchesruslawncare.com

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                            • #29
                              Some of our clients are monthly and some are weekly.

                              Monthly clients are bill the last day of the month for the next month.

                              Example: I will be sending out the monthly invoices for the month of April on March 27, 2011. They have 5 days to pay. (04/02/11) If its late, there is a $10.00 late fee.

                              So April has 4 weeks in it. So if I charge $10.00 per visit. Then thats 4 projected visits and they receive an invoice for 40 bucks. Now lets say out of those 4 weeks. it only gets serviced twice. Then when i goto send the May monthly invoice out the last week of April. They will have an existing balance of 20 bucks in their account and will be billed the difference.

                              I do it this way so I am paid ahead of time and no chance of someone screwing me over for work done and not being paid.

                              Weekly clients are required to pay for their services 5 days after completion of service. I made it 5 days cause if i cut on a Monday . Its due by friday cause most people get paid on fridays.

                              My contract states all this and then intial which they want... monthly or weekly payment schedule.

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                              • #30
                                Last year I was pretty naive about all this. I didn't expect to loose as much as I did. But 13% is a ton. That's like 6 weeks of pay!

                                To answer a previous question, If they didn't send payment I stopped showing up. I would send collection letters and even call them. I was going to take them to court, but the statute of limitation is 75 days, and I just waited too long.

                                What really surprised me is that not only is it not that much money, but that some of them were customers for over a year and just decided to stop paying without even talking to me.

                                If you want to fire me, that's fine. Maybe you don't like my work, maybe it's how much I charge, maybe it's that I'm a small business and you want someone with a bigger name, or maybe you wanted a service done that I don't do...whatever it is, can't they just say something before I put a few hundred bucks into their lawn?

                                I only have residential customer. Some of them have an at-home business (doggie day care, and a regular day care are the two I know of) and it's far easier for them to get billed.

                                This year, if someone wants to be billed, I will bill them out early and explain my policy. I will give them 2 weeks to pay, and if I don't get money before the 3rd visit, I will just stop going.

                                I also won't do anything that costs anything but labor and some gas...so I won't spray weeds, lay down lime, fertilizer, etc, until I get a months worth of service...that way the only thing I'm really out is my own time and a little gas.

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