So a client doesn’t pay?

On December 6, 2005, in news, by

So a client doesn’t pay and you normally hand over the Admin passwords upon payment, right?  So what do you do when a client doesn’t pay the bill do you without the passwords until they do?

Is this an ethical thing to do?

And you do realize that with physical access to that server, you can merely reset the Administrator’s password [keeping in mind that doing this on your AD/domain controller is very risky and not recommended but if the client is that dead set on not paying the bill…..]

If they bought the software, and owe you for the labor, is the password part of the Operating system that they own, or part of the labor that they still owe you for?

Do you include an arbitration clause in your engagement letter?

Do you screen potential clients?

  • You suspect he/she won’t pay.
  • There is a history (especially recently) of not being able to satisfactorily meet his or her financial obligations.
  • The person is experiencing deterioration in his/her business.
  • He/she has recently lost a key staff member or is experiencing high turnover.
  • The person has, according to prior vendors, a poor payment record. [In the United States one can review a Dun and Bradstreet report]

  • Do you educate your clients?  Do you send an engagement letter regarding your billing and payment policies?  If your billing practices are vague and irregular, your clients are more likely to pay in that manner as well.

    Do you review your client base?  If you have staff get their feedback.  Sit down.  Which clients are your “A” clients?  Which ones are “B”s” and “C’s” that need to be upgraded or fired?  Yes, you can fire a client.

    The better an engagement letter is, the better your understanding is up front.  An engagement letter helps to solidify money arrangements.

    [log onto smallbizit’s yahoogroups in the file section for examples of engagement letters and contracts]


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