You did the work.
You bought the materials.
You paid your employees.
You delivered exactly what the customer asked for.
And now you're waiting to get paid.
A week goes by.
Then two.
Then a month.
You've sent a reminder. Maybe you've even made a phone call. But the money still hasn't shown up.
And somehow, asking someone to pay you for work you've already completed has become the most uncomfortable part of the entire process.
That was the main conversation in a recent episode of the Planting Seeds Podcast when Nick and I talked about what small business owners should do when customers don't pay.
And one of the biggest things we kept coming back to was something that has very little to do with accounting.
It's the awkwardness of asking for money.
Which is strange when you think about it.
You already did your part.
Why should getting paid be the difficult part?
Meet Bob. He's Working for Free and Doesn't Realize It.
Nick brought back our fictional business owner, Bob.
Bob runs a commercial cleaning company.
He has a customer who pays $2,400 a month to have their office cleaned.
Well, they're supposed to pay $2,400 a month.
The problem is that they're two months behind.
They owe Bob $4,800.
And Bob is still showing up every week to clean the building.
Why?
Because he's afraid that if he pushes too hard for payment, he'll lose the account.
But Nick made a point that I think every business owner needs to hear.
If they haven't paid you in two months, are they really still a customer?
Bob is paying for cleaning supplies.
He's paying for labor.
He's spending time and energy fulfilling an agreement that the other party isn't holding up.
And every week he continues working without payment, he's taking on more financial risk.
In a way, he's giving that customer an interest-free loan without ever agreeing to become their lender.
That's not a particularly good business arrangement.
Why Is Asking for Money So Uncomfortable?
This was a question I threw at Nick during the conversation.
And I actually managed to stump him for a minute.
Why do we have such a hard time asking people to pay us?
I ask that as someone who's dealt with collections before and who is admittedly pretty good at making excuses for people.
Maybe they forgot.
Maybe the invoice got buried in an email.
Maybe they're having a rough month.
Maybe they'll get caught up next week.
And sometimes those things are true.
People make mistakes. Invoices get overlooked. Businesses have cash flow problems. Life happens.
But there's a difference between giving someone a little grace and continuing to provide services indefinitely without getting paid.
I think a lot of business owners struggle with this because they don't want to damage the relationship.
You like the customer.
You enjoy working with them.
You don't want to come across as demanding or difficult.
And you certainly don't want to lose the business.
So you keep waiting.
But that delay doesn't make the problem disappear.
It usually makes it bigger.
Have a Plan Before Someone Misses a Payment
Nick's first recommendation was pretty straightforward.
Have a plan.
And not one you come up with while you're frustrated because someone owes you money.
Decide ahead of time how your business handles overdue invoices.
For example:
If an invoice isn't paid by the due date, send a friendly reminder.
If another week or two goes by, make a phone call.
If the invoice reaches 30 days past due, consider pausing work until the account is brought current, consistent with your contract and any applicable requirements.
The exact timeline may look different depending on your industry, contracts, and payment terms.
The important thing is that you have a process.
Because without one, every overdue invoice becomes a new decision.
Do you call?
Do you wait?
Do you send another email?
Do you keep working?
And when you're making those decisions while you're worried about losing a customer, it's easy to keep putting them off.
A consistent process takes some of that emotion out of the situation.
You know what happens next.
Your employees know what happens next.
And your customers should know too.
Maybe You Should Get Paid Before You Do the Work
This was probably Nick's strongest recommendation from the episode.
Whenever it makes sense for your business, consider moving to prepaid services.
Instead of doing the work and hoping the customer pays afterward, collect payment before the work begins.
That might mean paying for a monthly service at the beginning of the month.
It might mean paying when an appointment is scheduled.
It might mean requiring full payment before a project goes into production.
Obviously, that doesn't work for every type of business or every contract.
But for many service-based businesses, it can eliminate a lot of unnecessary headaches.
You're no longer spending weeks chasing unpaid invoices.
You're not wondering whether a payment is going to arrive in time to cover payroll.
And you're not providing additional services to someone who already owes you money.
We actually made that transition at Harvest Advisory Group.
Nick spoke with our existing clients and explained how the new payment structure would work.
And for us, the conversations were much easier than we might have expected.
Now, that doesn't mean every business can change its billing structure overnight.
Some customers may need advance notice.
Some contracts may require you to wait until renewal.
And you certainly need to be thoughtful about how the transition happens so customers aren't surprised by two payments close together.
But the important part is deciding how you want the system to work and communicating it clearly.
Deposits Aren't Just for Big Construction Projects
One of my next questions was whether businesses should require deposits.
And Nick's answer was pretty simple.
If you can reasonably collect the full payment upfront, that's often preferable.
But when you can't, a deposit can help protect the business.
There are several situations where this makes sense.
Maybe you're a contractor who needs to purchase materials before starting a job.
Maybe you're a graphic designer creating something specifically for one customer.
Maybe you're a photographer reserving a Saturday that you won't be able to sell to someone else.
Or maybe you're building a website and know that the scope of the project could change once you get into the work.
I've dealt with that last one personally.
When I was doing website projects, I would try to collect a down payment before getting started.
Part of that was to cover the work I was beginning.
But part of it was also recognizing that the project might turn out to be more complicated than either of us originally expected.
A deposit gives the business some protection while the rest of the project is completed.
And for larger jobs, breaking the work into phases with payments due before each phase can make sense for both sides.
The customer doesn't necessarily have to pay the entire project cost at once.
And the business isn't carrying all the financial risk until the very end.
The specific amount and terms will depend on the project, the industry, and any rules that apply.
But the principle is the same.
You shouldn't have to finance someone else's project out of your own pocket.
Your Payment Policy Doesn't Need an Apology
Toward the end of the episode, Nick asked me how I would explain a prepaid policy to a new customer without making it sound like we didn't trust them.
And I think the answer is pretty simple.
You just explain it.
This is how we bill.
This is when payment is due.
This is what happens next.
That's it.
You don't have to explain every bad experience you've had with a previous customer.
You don't have to apologize for your policies.
And you don't have to make someone feel like you're suspicious of them simply because you require payment upfront.
It's just how your business operates.
I say that as someone who can sometimes overexplain things.
If a customer pushes back, my instinct can be to start explaining all the reasons behind the decision.
But most of the time, that isn't necessary.
People are used to businesses having policies.
You pay for a hotel reservation.
You pay for tickets before attending an event.
You pay for plenty of services before you actually receive them.
Your business is allowed to have a payment structure that works for how you operate.
The important thing is communicating it clearly and applying it consistently.
Unpaid Invoices Aren't the Same as Money in the Bank
Another question we discussed came from a business owner who said business was good, but half their money was tied up in unpaid invoices.
Nick's response was immediate.
Then business is only good on paper.
And that's an important distinction.
You can have thousands of dollars in outstanding invoices.
Your sales reports might look great.
Your revenue numbers might suggest you're having a strong month.
But if that money hasn't actually been collected, it isn't available to pay your bills.
You can't pay rent with an invoice someone hasn't paid.
You can't make payroll with a promise that a check is coming next week.
And you can't keep buying materials indefinitely while waiting for customers to catch up.
That's where cash flow becomes a problem.
The business may be profitable on paper while struggling to meet its immediate financial obligations.
And that's not a comfortable position to be in.
Don't Let Your Invoices Get Away From You
If your business bills customers after the work is completed, keeping up with invoices needs to be part of your regular routine.
Not something you think about whenever the bank account gets tight.
Nick offered a few practical suggestions.
Send invoices as soon as the work is completed, unless your agreement calls for a different billing schedule.
Make it easy for people to pay by including a payment link or clear instructions.
And review your outstanding invoices every week.
That last one is important.
An accounts receivable aging report shows who owes you money and how long those invoices have been outstanding.
It helps you identify problems before they become serious.
Maybe someone is five days late.
Maybe another customer is approaching 30 days.
Maybe there's an invoice that's been sitting there for two months and nobody has followed up.
You need to know that.
I mentioned during the podcast that when I was responsible for collections, I sometimes only reviewed those reports once a month.
Looking back, that wasn't often enough.
Especially when you're dealing with businesses that may have 30-day or 60-day payment terms.
By the time you notice something is wrong, a lot of time may have passed.
The longer an invoice sits unpaid, the more difficult collecting it can become.
So make it a habit.
Because sending the invoice is only part of the process.
Making sure it gets paid is the other part.
Sometimes You Have to Let a Customer Go
We asked another question during the episode.
Would you rather lose a customer or chase the same unpaid invoice for 90 days?
Neither of us had much trouble answering that one.
Lose the customer.
Because if you're spending months chasing someone who won't pay you, that relationship may already be costing more than it's worth.
And that's something small business owners don't always want to admit.
Especially when it's a large account.
You look at the contract.
You think about how much revenue that customer represents.
And you convince yourself that you can't afford to lose them.
But if they're not paying, that revenue isn't doing you much good.
You're still carrying the expenses.
You're still doing the work.
And you're still using time and resources that could be going toward customers who actually pay.
That doesn't mean one late payment should automatically end a relationship.
People make mistakes.
Businesses go through difficult periods.
And there are times when giving someone an opportunity to get caught up makes sense.
Nick and I both agreed on that.
But grace needs boundaries.
If a customer repeatedly fails to pay, continues asking for more work, and doesn't respect the agreement, it's okay to decide that the relationship no longer works.
You're not required to keep losing money just because someone has been a customer for a long time.
And sometimes letting go of one difficult account gives you the time and capacity to take on a better one.
Getting Paid Is Part of the Job
I think this is the most important thing from the entire conversation.
Getting paid isn't a favor you're asking someone to do.
It's part of the agreement.
You provide the product.
You perform the service.
The customer pays for it.
That's how the relationship is supposed to work.
And when that process breaks down, it creates problems that go well beyond one overdue invoice.
It affects cash flow.
It affects payroll.
It affects your ability to buy materials and take on new work.
And eventually, it affects how much time and energy you spend worrying about money that should have already been collected.
You shouldn't have to run your business that way.
Start by looking at who owes you money.
Pull an aging report.
Find the oldest outstanding invoice.
And make the call.
Then take a look at your overall payment process.
Could you collect upfront?
Should you require deposits?
Are your payment terms clear?
Are you following up consistently?
Do you have a point where work stops until an account is current?
Those are decisions worth making before the next invoice becomes a problem.
Because doing good work matters.
But getting paid for that work is what allows you to keep doing it.
Watch the Conversation
In a recent episode of the Planting Seeds Podcast, Nick and I talk about what to do when customers don't pay, why collecting money can feel uncomfortable, whether businesses should require deposits, and how prepaid services can help prevent cash flow problems.
We also discuss overdue invoices, setting clear payment policies, and knowing when it's time to let a customer go.
Planting Seeds Podcast: What Should I Do When Customers Don't Pay Me?
At Harvest Advisory Group, we help business owners understand what's happening inside their businesses, build better financial processes, and make decisions that support long-term stability.
Because a business can't operate on unpaid invoices forever.
And getting paid shouldn't be the hardest part of the job.