Monday, April 14, 2008

Should I give up, or should I just keep chasing payments?

Ok, so I've nicked the header for this post from one of my favourite songs of 2008 - Adele's terrific Chasing Pavements (what the hell does that mean???) and corrupted it to fit the continual bane of the micro-business - getting paid for the job done.

I've just been switching money between accounts to cover payments I need to make and am currently feeling poor - but I shouldn't be. At present, I have aged debt amounting to around £5,000 and nearly all of it's from one company.

Funnily enough, it's a brilliant company to work for and one of my very favourite clients in every respect except payment. It's a very large organisation and some time ago it off-shored its accounts payable function....and that's where things started to go wrong. The resulting dislocation between those who commission the work and those who settle payments and the numbers of people involved in the chain from raising a purchase order to receipting it to reconciling that with an invoice to final settlement mean that while I know I'll get paid eventually, the process is slower than any other client and also has a tendency to fall down - not least because the payments staff are not at all proactive if there's any discrepancy between an invoice and a purchase order (I've had an invoice held up for months in the past because I charged less than the PO raised!).

The net result for me is unpredictable cash-flow and too much time wasted chasing payments.

About a year ago, someone in the company told me not to bite the hand that feeds me - no doubt after reading of my payment frustration on this blog in the past. I took heed at the time. But now feel that's not fair. They should be getting their payment system in order, not playing on the fears of freelancers that we'll lose projects a) if we stop taking on work before any purchase orders are raised (their standard, though wrong, practice), and b) making a noise when payments don't happen. Being told not to bite the hand feels ever more like being leaned on by Goliath.

Waiting on payments of £5k (some of which go back over a year) would have no impact on this company, and anyone on a regular salary wouldn't feel the impact either. But this is my salary, and pension payment and payment to a designer for a bit of work and to my bookkeeper plus insurance, bank charges and all the rest. I have no comeback on this company. Should I make any threat, they can just move on to another supplier - and I actually really enjoy the projects they put my way and have a good relationship with the people who commission me.

Taking the brunt of their internal inefficiencies beyond their direct control is very frustrating.

Of course, they're not the only company that operates in this way - far from it. Increasingly, the larger the company, the longer I have to wait for payment and the more chance there is for a cock-up along the way. I've got used to it, but it doesn't make things any better.

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