Getting Paid: It Starts with the Invoice

(Editor’s note: In today’s uncertain economy, freelance photographers are waiting longer than ever to receive payment from their clients. Following is the first in a series of articles by Brandon Cotter, founder of ZenCash, offering tips to accelerate your cash flow.)

When it comes to getting paid for freelance work, Ottawa-based photographer Younes Bounhar quips, “baseball bats work wonders.” But for the less athletic among us, the most effective instrument is still the invoice.

Invoices are even more important these days with studies showing that in this economy, customers are taking longer than ever to pay small businesses — an average of 48 days, according to a survey by the National Federation of Independent Businesses.

Requiring Prepayment

The simplest of invoice terms, of course, is prepayment. Dallas-based Rachael Ellis, who specializes in wedding and custom art photography, insists on it. And don’t give her a check. It’s cash or a money order.

Withholding work until payment is delivered may be the next-most-popular approach. But most invoices aren’t so simple, and freelancers have to get more creative. Many insist on at least some part of the payment up front. It’s collecting the balance, of course, that gets tricky.

Plenty of freelancers use late fees. British photographer Bruno Conrad learned them from his father, a freelancer for 30 years.

“He said to me that you should state, on your invoice, that the payment must be made within 30, 60 or 90 days, and then add a 10 percent charge for each week that the payment went over the stipulated date.”

Conrad says, “It might not make any difference to being paid on time — especially with bigger companies — but at least you’ll be making money off them when they do drag their feet with payment.”

Offering Discounts

Californian Lara White says her company added a $100 late-fee policy just this year because so many payments were late. Others turn the late-fee idea around, and offer discounts for paying on time. In Florida, photographer Ken Hayden promotes discounts for “quick payment.”

Regardless of the terms, photographers seem to agree that another key to getting their money is offering payment methods customers will use. PayPal is a favorite, along with others like Square, the credit-card processing service.

“Nothing like being paid instantly!” one Square fan raves.

There is plenty of help online with invoicing with companies like FreshBooks, Harvest, Blinksale, ShootQ and others. The FreshBooks website boasts, “You’ll actually enjoy invoicing!”

“I get paid sometimes when I completely forgot a client owed me money,” says Texan Jonathan L. Golden. “It’s great.”

Staying Vigilant

A last area of consensus when it comes to getting paid is one very familiar to freelancers: vigilance.

Says Canadian photographer Paul Ritter: “Don’t procrastinate! I start post-processing as soon as I get home from a shoot.”

But it all starts with the invoice, a lesson Stijn Swinnen learned the hard way.

Four years ago, he says, he joined a cooperative photo exhibit in Belgium. One of his works was a large panorama of the city’s main square. The photo attracted the interest of a potential buyer, who wanted to display it in his downtown building. The sale never went though, and the work was damaged – accidentally, but beyond repair.

“They didn’t want to buy it or refund for the damages, so it was worthless for me,” he says.

“My mistake? We never set anything on paper.

“No agreement, endless discussion, no money for me.”

Next: Prodding the slow-paying client

4 Responses to “Getting Paid: It Starts with the Invoice”

  1. Invoicing is small step but makes big difference for business. Like idea of giving a small break to clients who pay in full amount upfront...helpful article.

  2. It's been my experience that the larger the company, the slower they pay. I've learned not to take it personal.

    I at one time was the website designer and in charge of most of the marketing material for a large South Eastern hospital chain. They had over 12 hospitals, 250 clinics, and I can't even count the number of doctors offices. Even a medical school.

    I would invoice net 30 always keeping it within the budget set by their marketing team and it would be 90 days before I would see payment. I took it pretty personal until I learned that they did this with all their bills so much that the local trash company refused to pick up their trash for 2 days until payment was brought up to current.

    This was a multi-billion dollar corp that was in the habit of dragging their feet and I was the little company needing their check to pay the phone bill.

    The next slow payment group seems to be the ones you give the most to for the least amount of money. The client that walks in wanting something for nothing and to pay the phone bill you take the job.

    I've learned it's easier to simply turn the penny pincher's away and keep the large companies on a shorter payment schedule.

  3. Great article, one that resonates with my own opinion. I've said it many times before myself, that when larger companies are tardy in paying small business owners what they owe (be it due to inefficient processes, red tape, or just because they always pay NET90 regardless of the terms) it can effectively choke a small business into bankruptcy. Cash-flow is the lifeblood for a small business, and it only takes one big invoice not being paid, for us small business owners to feel the pinch.

  4. I handle it this way: In my standard contract, it's stipulated that the licensing doesn't begin until payment in full is received. In the one case where work needed to be published prior to completion of the project, the clause was modified to have licensing revoked if payment wasn't received by XX Date.

    No one has ever complained because when they're negotiating the contract, who is going to say "We don't think we can pay on time." If they did, do you really want them as a client?

    Only once have I not been paid on time and they were quick to rectify that once I reminded them of the terms and pointed out that their use of my image in the absence of payment was infringement.

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