business advice | Jun 14, 2022 |
I waited too long to send a big invoice. Help!

Dear Sean,

It’s been a busy couple of months for our firm, and I’ve fallen behind on monthly billing. Big picture, I know better. But unfortunately, I now have two projects where I’m about to send massive invoices to get caught up—and I’m very nervous about it. How do I get out of this hole I’ve dug, and how do I present these invoices in a way that will create the least friction or resistance with my clients? Are there ways to own the billing delay without looking unprofessional or to present payment options since I understand that the pileup was my fault?

Plus, while we’re talking about invoices, any practical improvements I can make so that I don’t get myself in this kind of jam ever again?

Shy Invoicer

Dear Shy Invoicer,

Let’s start with the obvious: Value mismatches always present issues, especially when some or all of the billing pertains to design. The shelf life of an idea is microscopic before it becomes plain—which means the design that was awe-inspiring when you first showed it becomes more accepted the longer someone looks at it. If you bill for design long after it was delivered, it becomes increasingly difficult for clients to remember the value you provided. Were the 30 hours you billed for coming up with the design of the living room really worth it when you are asked to pay for it three, four or even six months later? Likely not.

So what to do about it? In this case, nothing. Send the bill, expect to be paid and move on. Ironically, the more you make an issue out of it, the more you infantilize everyone. Your clients can read—they signed your contract and know what they are responsible for. Nobody is arguing (yet) that you are entitled to be paid what is due, and you disrespect everyone if you allow the notion that the money is not earned until you bill for it to permeate the conversation.

If you make it a thing, especially if you offer a payment plan, you double down on your mistaken notion that somehow money was not earned unless billed. Due maybe; earned, never. No contract on the planet will excuse payment for late billing. If your clients were going to have an issue with receiving a large delayed invoice from you, why is it any more your responsibility than theirs to let you know? Nothing has been stopping them from making a good-faith payment each month for which they ultimately expect you to reconcile when you are able. If you are a small firm, what would they have you do: focus on billing, or getting their project done well?

Now, please do not misunderstand. Untimely billing is a huge red flag that your house is not in order. Your design business needs money just like any business to exist, and if it is not properly “fed,” real questions arise as to why. Maybe you are making more than you should, or maybe the business is a hobby and you do not need the money to operate. Worst of all is if you are in chaos and not keeping track of things. No matter the reason, delayed billing erodes trust and is inexcusable in today’s digital world. If you aspire to more, you should absolutely be consistent in your billing.

Here’s the catch: The issue is not actually in sending a single large bill but rather the inconsistency with expectation. If, heretofore, you have been billing monthly but have slipped to every three months, that is the issue—and also the solution to your problem. Perhaps you can only afford (financially or physically) to do your bills every other month. That’s fine—do that. In many parts of the world (and for most teachers in the U.S.), employees are paid monthly and left to figure out how to budget with a single monthly paycheck. It’s certainly easier on the companies to only run payroll once a month, just as it might be for your firm to invoice less frequently. Once expectations are set, everyone can adjust. Your design business is no different.

No matter what, make billing your number one priority when it comes to managing your clients. Set whatever expectation works for you and your design firm best, then live there. And with regard to your current situation, give yourself the single get-out-of-jail-free card we all deserve, but know you have no other.

Homepage photo: ©Franny-Anne/Adobe Stock


Sean Low is the go-to business coach for interior designers. His clients have included Nate Berkus, Sawyer Berson, Vicente Wolf, Barry Dixon, Kevin Isbell and McGrath II. Low earned his law degree from the University of Pennsylvania, and as founder-president of The Business of Being Creative, he has long consulted for design businesses. In his Business Advice column for BOH, he answers designers’ most pressing questions. Have a dilemma? Send us an email—and don’t worry, we can keep your details anonymous.

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