Getting Paid

As a small business specialist and more particularly as someone who has had his fingers severely burnt in the past, I thought I would air my thoughts on the getting paid side of my business.

I have a simple policy: No credit. Generally, this works fine - many of my clients pay their up-front deposits without arguing and then pay the balance on completion. I like that. And I like them for paying so promptly. Its clean and simple and it allows me to cost less - because believe me, if you wanted to pay on 30 days you'd be paying significantly more for the privilege. Its a trade-off for both me and my client.

So why am I such a hard-nosed bastard? First off, I may seem hard-nosed but I'm not. People who are purchasing my services are not buying them as "stock" to sell on for an eventual profit. They are not waiting for someone to pay them for the service they just bought. Sure, my services are there to help generate business, but lets be honest, they are just part of a whole range of things one must do to attract customers.

Secondly, I have very few clients with a track record long enough - or more importantly, big enough - to qualify for a 30 day account. When a business can demonstrate a continuing habit of spending about 5k a month with me, (and they do not make up a major percentage of my overall income) then I will be astute enough to offer to ease their path with a 30 day account. I will also do other things to earn their love and loyalty: A (genuinely free) lunch or two, perhaps drinks after work on a regular basis... But I will also watch them like a hawk. I do not tolerate 30 days slipping into 60 days...

Thirdly, and I've already touched on this, my clients get to benefit from my many years of experience and my hard-won skills, not to mention talent, for a very reasonable rate. Working as I do with start-ups and small businesses, I have to compete on price with others. If my quote is not attractive in the first place, it is unlikely that prospective clients will hang around to discover my talents.

My cash system seems to be working quite well. I do have the odd hiccup with the occasional client who pays the balance late, but at least I'm still in possession of their work. Also, the balance due is seldom a back-breaking amount. I make sure that it isn't by offering clients a staggered payment arrangement over the course of a big-spend project. But most importantly, I believe that my clients are glad to pay for the work because I deliver beyond their expectations.

I have been using Google Checkout for client payments, but recently I have been getting them to pay directly into my account by bank transfer. Why? Because these days the transfer amount is generally reflected instantly rather than in the past when the banks required four working days for 'clearance'. Google Checkout, I suspect, sits on the cash and earns interest for a few days before crediting it to my account. Not good enough!

Lets talk about the money

Most people know that if you pay peanuts, you get monkeys.

It never ceases to amaze me therefore, how little people are prepared to spend on their marketing. Sure, times are tight and start-ups need to watch their pennies, but I see more small businesses wasting their money on bad design, bad websites and marketing collateral than I see wise investment.

The problem is multi-faceted and not just the fault of the small businesses. These days, anyone who owns a computer and a bit of (often illegally copied) software can call themselves a designer (I own a pen but that doesn't necessarily make me a great writer). And some, the gifted salesmen among them, do very well out of selling their clients bad or at best, mediocre work.

The client walks away happy; he got a bargain and he likes the colours. His market may think otherwise. They, unlike the designer or his unwitting client, can tell the cheap and nasty - especially when they are shopping around. Brand A is compared to Brand B and first impressions start counting.

A good designer will first of all be visually literate. He'll create work that has balance, elegance and is appropriate to the product and its market. The design will sit well against competing brands yet will be unique. Quirks will be "right" and any experiments or abandonment of convention will be carefully considered and supported by well reasoned arguments.

Lets face it, clients come to designers because they need someone to do something they cannot do themselves. Its a tragedy that quite often the designers are no better than the clients. I see it all the time in branding, brochures and websites. I see where clients have happily shelled out money for work that would get the "designer" fired from even the most junior position in a proper agency.

And the irony is, using a decent designer probably won't cost much more anyway. As designers, bogus or otherwise, we all know what sort of rates clients are prepared to pay. We all get to quote against each other and even know that sometimes, we've lost work to someone who is genuinely going to give better bang for the clients buck. But not often. The reality is that every day, the DTP revolution empowers more and more people, save a for a tiny few, to flood the world with bargain basement mediocrity.

Am I angry about this? Well, yes and no. Yes, I lose business to the wannabes who have also driven down the price and perceived value of good design. And no, there are still some clients who appreciate the value of quality design - and those who have suddenly found the wannabes to be, err... wanting: those who have contacted me or one of my "proper" competitors to rescue their brands, their websites and marketing campaigns from obscurity.