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  1. #1
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    Question How do collect past due payments

    Sending clients to collections? Has anyone gone that far that they use a collections agency? I guess that would only be used for a large amount of money.

    Does anyone else have a great way of getting customers to pay past due invoices?
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    If they won't pay then they won't pay, not much you can do to force payment other than legal action. Fortunately with our business most but not all invoices are for small amounts i.e under $50 and are simply not worth the legal expensive and work to recover. I'm sure if someone is leasing many dedicated servers or colocation space then yes this amount of money should be pursued.
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    If they are past due, you could add a extra fee and/or suspend their service.
    Sometimes they will only take notice once their site is offline, then they will come back to pay.

    If they do not come back and pay the past due amount, terminate the account and move on.
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    Dedicated Hosting - suspend server and move along just capture the clients IP to be sure they don't try and re register a service with you and basically word of mouth them to different host you associate yourself with so they don't jup anyone else.

    Colocation Hosting - Pretty much everything is in the contract you can hold the clients hardware until they pay up on the bills they owe. If your in a lease of course terms are different and what not depending on the contract you have but if your in colocation most clients pay the bills.

  5. #5
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    Quote Originally Posted by RDO Servers View Post
    Sometimes they will only take notice once their site is offline, then they will come back to pay.
    If they do not come back and pay the past due amount, terminate the account and move on.
    This exactly, it's amazing how quick someone pays when you disable the service. If they still don't pay or contact you then you know your not getting any money.
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    Yes, this is pretty much what we have adopted. Suspend, that usually gets someones attention. If not then delete.

    Quote Originally Posted by RDO Servers View Post
    If they are past due, you could add a extra fee and/or suspend their service.
    Sometimes they will only take notice once their site is offline, then they will come back to pay.

    If they do not come back and pay the past due amount, terminate the account and move on.
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  7. #7
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    Quote Originally Posted by energizedit View Post
    Sending clients to collections? Has anyone gone that far that they use a collections agency? I guess that would only be used for a large amount of money.

    Does anyone else have a great way of getting customers to pay past due invoices?
    Using collection agency or anything like that is rally ineffective. Unfortunately there is no good way unless you have leverage of something they want/need.

  8. #8
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    Quote Originally Posted by energizedit View Post
    Does anyone else have a great way of getting customers to pay past due invoices?
    Hired Recovery "Agents"


    The answer above is not an actual service, and not endorsed by this forum.

  9. #9
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    Quote Originally Posted by WPCycle View Post
    Hired Recovery "Agents"


    The answer above is not an actual service, and not endorsed by this forum.
    LOL Why does this sound like something the mob would do.
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  10. #10
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    Unfortunately these days there are a lot of people that just default on their payment and it happens for many reasons. I'm sure that some people know that nothing much will happen to them if the amount is low because it will cost more to go after that small amount than it's worth.

    I agree with RDO Servers approach to this issue and just add a extra fee and/or suspend their service and see if that gets them to pay. If not then just terminate the account since it's not worth the cost and hassle.
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  11. #11
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    I agree with all the above opinion but just want to extend some information.

    It is true that it is no point going for legal action on something less than $10 dollar or even less than $100 dollar in the hosting industry. First of all, your customer may not even be in the same country as you, if you have international customers. Legal action cross border can be very costly. Even if they within your same city you can sue them in local court, but this does requires filing fees. The time you spend at court and such does not warrant the financial gain from a judgement that is in your favour. However you can take several precaution to reduce the amount that people may own you, some call this as minimise your damage in situation where bad event can occur.

    In the term of service you can say that a customer account can be shutdown within 3 days of a none payment. Any files, software that store on the server that belong to a none payment account are irretrievable unless they pay back what they own you. Most paying customer that are financial reliable will not mind this, they will most likely pay their bill on time. Do give people the option to restore their account though when they do pay their full owning amount.

    In the event where it is one year term contract, it is best that you collect the cash payment first if the total price is less than $200 dollar.

    There is a third option. If you have plenty of default accounts that had been defaulted for a very long time, and you also have all the necessary documentation to claim those people did indeed own you debts. You can sell the default debt portfolio to a collector agency. They may buy it at about 10% - 30% of it's value. The cheap price that they pay is due to the fact that it is a very risky business buying out debt portfolio, they themselves the collector may not even be able to recover the debts.

  12. The Following User Says Thank You to kevinhng86 For This Useful Post:
    Maxoq (01-12-2017)

  13. #12
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    Quote Originally Posted by kevinhng86 View Post
    There is a third option. If you have plenty of default accounts that had been defaulted for a very long time, and you also have all the necessary documentation to claim those people did indeed own you debts. You can sell the default debt portfolio to a collector agency. They may buy it at about 10% - 30% of it's value. The cheap price that they pay is due to the fact that it is a very risky business buying out debt portfolio, they themselves the collector may not even be able to recover the debts.
    Nice one, I didn't think about this option but now that you mention it then it can be something to look into. I don't know what kind of stipulations and requirements those types of services go by but it can't hurt to look into it.
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