Getting Customers to pay?

[Ddraig]

Howdy,

I'm just starting to do hosting for a few poeple and I am curious as to how you go about getting customers to pay on time? Any tips, ideas, or things like that would be appreciated.

Currently I send out email invoices, along with a paypal subscription link so poeple can actually subscribe and have re-occuring payments without having to enter their information in.

[cliffnote]

removed duplicate

[cliffnote]

Hi... I've been hosting clients for years and have also done a lot of web development. Here's a couple of things I've done that works.
Hosting paid in advance, 6 months at a time. (I don't like to collect small fees-monthly... if they don't like that, they can go to places that will collect)... In 5 months give them invoice notice. If don't pay on time, send notice they need to pay by xx/xx/xx to insure no interruption of service. Then I call them... never had to distrupt service (and probably wouldn't actually cut off service due to possible liability things, but I don't tell them that.)
On collecting for web development work. I tell my clients I collect payments like a gas tank in a car. In other words, we'll estimate the budget, they put 1/3 or 1/2 into the 'tank' and I'll work off that... I give them notice before going empty so they can put more in the tank and also give them a status report of how we're doing on their projected budget. (I avoid fix price websites since there are too many variables that can alter the price... it's creative design, not a off-the-shelf widget. Also, I say how "WE" are doing on the budget since they influence it by their phone calls, changes, adding features, etc.)
Because I'm always working off their money, I never have to worry about not getting paid. And, for start up businesses or private parties, some can change their mind about having a website before you actually finish it-- and THEN try to collect. So, the gas tank principle has worked beautifully for me for years. By the way, usually on the very last 1/4 of the work or there abouts, they'll owe me some because I'm a little more relaxed toward completion. The preagreement I have is that once site is approved and ready, I put it Online ONCE I receive the final check. (just tell them it's policy)... Once they're using the site online, receiving the last check can be a problem. This way, they're anxious to get it online, so they get the final check to you pronto.
Also, one side tip. Throw in something extra that they didn't expect and that pleases them. Don't charge them for it. The goodwill will generate business referrals for you. (also, that way it might also offset something they don't like that much) I've never had to do marketing for clients since I always get enough referrals from happy clients.... so always strive to make them happy. (though some people it just won't happen for... in general, you can get about 95% or more pleased with your work if you really listen to their wants/needs and anticipate the wants/needs of their visitors/audience/customers too.)
Hope that helps you and other readers.
Cliff

[Ddraig]

Great tips thanks that will help a lot.

I was definately thinking about doing the 6 months payment in advance. I will have to remember to do that.

[Lightlord]

Some techniques I use.

On websites I aim at 50% upfront and the rest do upon completion. Alot of time payment gets delayed because you are waiting on content from them. If they are slow in generating content which happens alot this can drag out getting paid alot longer than you expected. i.e they are trying to squeeze bios from eployees that are going into a website, or the need to provided specific info on a product or service they offer etc.

I have nerver offered a payment option for the web site itself.

Hosting and maintenace payments.


Say I really want 120.00 dollars a year for hosting. You can work a variation of all upfront for domain renewel cost. Payments on site maintenance/updates.


I offer the following options:

Example:
Payment Options on a 1 year contract are:
anually 120
bi-annually=65
quartery= 35

Here are the saving options. Which do you prefer MR Client?

I never offer a monthly option. I never had anyone to request monthly payments




LL

[\\.\]

I would only like to add that theirs legal implications when you demand upfront monies.

Whereas the goods delivery - invoicing - payment system works, as soon as you step over into the Payment in Advance markets, you open yourself up to a huge amount of legal issue should you fail to deliver.

You could easily be sued, all the customer has to prove is that you failed to deliver and are in breach of contract which you will be if your server goes down even for a second.

If you chose payment after delivery, that then means that you can legally peruse the customer through the legal system, suspend accounts, apply late fees and so on, stuff you can not do if you demand payment in advance.

Are you planning to use a web hosting bulk reseller package or are you looking to do this from home? If its a home serve job, you will have allot of other considerations like security, power, backup services, fire risks, equipment spares, repairs, etc, the list goes on...

Unless you are sure that you can achieve "Five Nines" uptime, don't home serve as it can be a major headache for you.

[Ddraig]

I plan on doing this through a reseller hosting. So I don't have any problems with backups and service isssues. I'm thinking more in terms of hosting than anything else which is what I would like to build up. So I am giving consideration to a yearly subscription fee, which gives sometype of discount. If they pay for the full year. I don't expect to be big and I would be happy with a handful of customers to offest my own hosting of personal websites. That's my current goal at any rate.

[Kimberlh]

Howdy,

I'm just starting to do hosting for a few poeple and I am curious as to how you go about getting customers to pay on time? Any tips, ideas, or things like that would be appreciated.

Currently I send out email invoices, along with a paypal subscription link so poeple can actually subscribe and have re-occuring payments without having to enter their information in.


Have you consider getting a legal contract to make people sign when signing up. You can use adobe to so they can sign digitally and email it back.

I own adobe professional to do that but that is very costly software, I think there is an online version of adobe at their web site to make one form (contact) people sign for people who really do not need to buy the software.

Then if they do not pay you have legal contract to remind them of. Of course going to court is costly and often not worth the time, money and effort but that fact you have a legal contract with them give you something to hold over a person head. Plus you can put in late fee in the contract to you can change for late payments. Also put fee for canceling the contract early.

You also need a contract if you are reselling because if the person you are renting space to does something to break the your host rules you have a course of come back on them.

Myself I use Rackspace and have a few people I resell to and I always make them sign a contract to protect my own business legally.

Hope that helps