Hello Again,

I am fleshing out my payment policies today and have another question. I have decided that basic office supplies, phone time will all be included in my hourly fee. However, should a client hire me to do a bulk mailing or some task that may require specialty paper, I am going to bill them the cost for the postage or specialty goods. How many of you do this and if you do, do you provide the fee breakdown prior to starting the work and ask that the additional fees be prepaid or do you put out the money and then bill the client for the costs.

I am a bit torn on this one. I have seen this handled both ways in the workplace. As an employee we used a mailing house that required us to mail a check for postage prior to the start of the project (we would give them the weight of the newsletter and they would figure out the total cost of postage)...we had no problem with it. I just don't want to seem extremely distrusting if I went this route, but I don't want to be stuck with the costs either. Any advice?

Thanks again!
Darlene

Darlene, I don't think requiring prepayment is going to necessarily make you appear 'distrusting' - many people, especially small businesses are used to working this way and understand that's just 'the way things are done'.

It's also very common for freelancers in many industries to request deposits before work will begin on a project. If it makes you feel more comfortable - at least until you've built up a relationship with a regularly paying client - then by all means request at least a partial deposit based on your understanding of what the cost will be.

Personally, I take a deposit from all new clients and hold that against their last invoice on a project or six months of invoices paid on time(whichever comes first) at which time the deposit is volleyed back to them via the invoices themselves. That way, I'm covered (to the degree I request deposit anyway).

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Hi Tess,

Partial deposits from new clients may be the way I am going to go. I have been thinking about it and even bounced some ideas off some friends and family too. It just seems like a practice that is not unheard of and since one of my target markets is going to be Home Improvement contractors, they will certainly be accustomed to the idea.

Thank you.

Darlene

I second what Tess said. When I was running my husbands construction company, on all of our public work we did they held a retainage fee of 20% of the total invoice for a year. It is something that is done in the business world and my thought process is if a client doesn't understand it then I don't want to do business with them.

Don't be torn on it Darlene, your doing good!

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Dawn Riley
A Virtual Assistant in Paradise
Our business is about making yours better

I agree with all the posts as well! Be sure to spell this out in your contract and web site so there is no confusion as to what has to be paid when. Payment for my client expenses is due upon receipt and all other invoicing is done on a monthly basis. If I have a retainer client, they get the choice to deduct that from their pool or to pay separately. Asking for partial payment up front is a standard business practice! Go for it!

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Doreen R. Patrick, MVA, ACS, CIVA
www.virtualbusinesspartners.net