Life gets busy. Whether an invoice gets lost in an overstuffed inbox or a client is going through a major life change, sometimes people miss payments. We asked eight designers—Rhonnika Clifton, Clara Jung, Karen B. Wolf, Byron Risdon, Maria Khouri, Tyra Johnson, Erin Coren and DuVäl Reynolds—to explain what they do about it, and how to hold clients accountable without damaging the relationship.
GET IT IN WRITING
“Recently, we updated our client agreement to include late fee terms that require a 10 percent fee on invoices over 30 days late; 25 percent on invoices over 60 days late; and after 90 days, the invoice is referred to a collections agency and the late fee increases to 35 percent. We also added verbiage that states: ‘The nonpayment of balances due may result in a mechanic’s lien.’ Additionally, our agreement has a reinstatement clause that supports our firm if a client delays or puts the project on hold for more than 60 days. Both clauses are crucial to our processes and overall financial bottom line.” —Rhonnika Clifton, RJ Clifton Designs, Houston
FALLBACK PLAN
“We start with gentle reminders via email. If we need to escalate it, we remind them of the contractual clause stating monthly interest rate penalties for late payments. We’ve never enforced it, but it’s good to fall back on. A couple of times, we’ve stated to the client we can’t work any further until we receive payment for services and goods already rendered. More importantly, I’ve become diligent about receiving payment for goods in full—most of the time—and we have a retainer that we save to apply to the last invoice.” —Clara Jung, Banner Day Interiors, San Francisco
GOOD KARMA
“Sometimes, as the [firm] principal, I do have to intervene on late payments. Typically, the payment is made after a thorough review or gentle reminder sent from our accounting department. On the rare occasions that we are not paid, I do not take legal action. It is unfortunate and discouraging, but not worth the legal fees or mental diversion. I truly believe in karma, and I am confident that a client who stiffs us is living with their own guilt.” —Karen B. Wolf, K+Co. Living, Short Hills, New Jersey
TAKE IT IN STRIDE
“After 30 days, if payment has not been made, the invoice is resent. I understand sometimes emails get pushed down on the [to-do] list. If we don’t get a response after seven days, the bookkeeper reaches out directly to the client to inquire as to why payment has not been made. Typically, it’s taken care of right away, but occasionally it’s because a client had a question about a charge but hadn’t taken the time to ask. I don’t mind having money conversations as it’s all part of the process.” —Byron Risdon, Byron Risdon Interior Design Studio, Washington, D.C.
BENEFIT OF THE DOUBT
“This is a delicate issue, and usually we will send out a gentle reminder by email for late invoices. Everything always works out—sometimes people just have a lot going on and these things can slip their mind.” —Maria Khouri, Maria Khouri Interiors, San Francisco
OPEN LINE OF COMMUNICATION
“Before initial invoicing occurs, we discuss late payment terms and how late payments affect project timelines and may lead to additional fees. I include this information in the project contract that is signed and attached to the invoice. Once a payment is officially late, I send a personal email to ensure there isn’t a larger problem manifesting itself as a late payment. Most often, I find clients have simply lost track of time, and reaching out helps maintain relationships.” —Tyra Johnson, Tyra J Studio, Dallas
PRESS PAUSE
“It is always an uncomfortable conversation. However, we get that clients have busy schedules or they’re waiting for bonuses before finalizing payments. Interior design is a sizable investment, and we are asking for trust and respect on both sides. We give 15 days for payment to be made, and we don’t currently have late fees. We prefer to have open communication to see what the issue is and whether we need to clear up any questions, or if they need to portion out a purchase. We try to give realistic numbers at the beginning of a project and then fine-tune as we get a clear understanding of their goals. Nonetheless, someone might lose their job or life gets in the way, so we have in our contract that we have the right to stop working until bills are paid. Should they need to pause, we are happy to work with them on timing so they have a good experience and are happy with the end result.” —Erin Coren, Curated Nest Interiors, New York
GIVE THEM GRACE
“While we would love to say that we collect interest on delayed payments, it’s just not true. We are generally lenient on late payments. However, we do increase our frequency of sending invoices, to show our urgency [in seeking] payment recovery. Because we have experienced not being able to pay invoices ourselves, we tend to offer grace to those who are late—although maybe too much at times.” —DuVäl Reynolds, Duväl Design, Fairfax, Virginia
Homepage image: A moody and enchanting bathroom by Maria Khouri | R. Brad Knipstein Photography
