How Freelancers Can Prevent Non-Payment and Other Client Disputes

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Now that we’ve done our part in trying to solve our client disputes, it’s time to prevent them from happening again. How do we do this? It starts by learning from our past experiences.

You can still save your business from further financial loss and emotional stress if you know how keep things in order when the next client comes around. With that said, here are five ways you can prevent non-payment issues and client disputes once and for all:

1. Choose Your Clients Wisely

You’ve been burnt by a client who you thought was trustworthy and reliable. Now that you’re back up on your feet, you should be more careful in choosing who you’re gonna work with next.

I’ve mentioned keeping an eye out for several characteristics of a good client, but it’s also important to be on the look out for clients who are only after free work or who are disrespectful to his contractors. Here are a couple of red flags to watch out for:

  • The client asks for free samples of your work.
  • The client keeps insisting on lowering your rates.
  • The client won’t pay unless you submit the work 100%
  • The client is poor with communication and availability.
  • The client is very vague with his instructions. He might not have any business goals in mind after all.
  • The client is very strict with how many hours you bill, micromanages everything you do, and constantly makes you revise your work for no pay.

I suggest bailing out if the client seems to fall under at least 2-3 of these bad signs. Better safe than sorry, if you ask me.

2. Secure Your Project with a Contract

The first step is prevention, and one way of preventing the possibility of your client stealing your work without pay is to secure a contract.

For freelancers who work with clients located in their area, this shouldn’t be too difficult to do. Drafting and getting your potential client to sign under certain terms of agreement will not only clarify each other’s roles and responsibilities, but it’ll also serve as a mediator whenever a conflict or issue arises during the project.

For freelancers who work with clients who are a thousand miles away, emails and conversations over Skype can already serve as your proof or contract. If your client becomes uncooperative, you can show him the emails you exchanged and point to where he is violating what was agreed upon.

Another option is to create a contract that can be signed with an electronic signature. This is basically a business solution that allows you to create, send, and sign documents using an internet-connected device like a mobile phone or the browser of your computer. If your client doesn’t have a printer and scanner to print, sign, and send back your contract, you can use this option instead.

3. Impose an Initial Deposit.

Another way to ensure that you won’t get scammed again is to secure an initial deposit or upfront payment from the client before getting any work done.

Now this isn’t a strategy for pushovers and weaklings. Your client can outrightly refuse to give a deposit if he knows he can pull your strings easily. So be firm when asking for upfront payment. 20% to 50% is perfectly okay if you’re confident with your skills and abilities to get the job done.

Here’s an important tip: Start including upfront payments as part of your policies as a freelancer. Inform the client that it is part of your terms and conditions to receive an initial deposit before starting on the project. Almost all major services follow this rule.

If the client respects your terms and conditions, and you keep your end of the bargain, I’m sure that your project will succeed and your partnership will be a happy one.

4. Remove the Client’s Rights to Your Work

Remember when I said to secure a contract before doing any kind of work for a client? Well, a contract will only work if you know how to set rules and conditions that are applicable to your current situation.

For example, even though you mentioned in the contract or email that the client must pay upon receipt of invoice, there is always a possibility that the client will ignore that sentence. He can always get away with your work since there’s no lawyer or witness who can defend you or run after him.

So here’s what you can do: Use your portfolio as your secret weapon. In your contract/email, indicate that if the client refuses to pay the amount due or does not wish to abide by the terms of agreement, you are obliged to remove his rights to the unpaid work, and will post the unpaid project on your portfolio for the benefit of future clients.

Okay, so this strategy isn’t going to get back all the time and effort spent, but the point is that you can still keep your work if the client refuses to pay. You can use the article, logo, website theme, or application in your portfolio, and showcase it to other potential clients who are (hopefully) more cooperative and willing to pay you for quality work.

5. Be Firm with Both Yourself and the Client

None of your efforts in preventing disputes like non-payment and abuse will matter if you’re never going to get a hold of yourself. You keep saying that you’re never gonna let this happen again, but then you’re still allowing that nasty client to take advantage of you.

It’s high time that you put your foot down on this matter. Be firm with your decisions to require upfront payments and contracts. Be firm with how much you charge and how much you’re willing to work for the client. And most importantly, do not be afraid of losing this client or this opportunity, because in the end, you might just be wasting your time and energy on a person that doesn’t really care about how well you write or how awesome your logos or designs are.

There are still plenty of good clients and projects out there waiting for a talented and hardworking freelancer like you, so don’t give up. Even if you get burned once or twice by a client dispute before, what’s important is that you’ve learned your lesson and are much more careful this time around.

Success seems to be connected with action. Successful people keep moving. They make mistakes, but they don’t quit. — Conrad Hilton

Photo credits to lecasio, downthewaterfall, and shho