Invoice Issue

[Steve Kownacki]

I’m hoping you have your facts straight and that client B did not in fact pay company A. Perhaps your employer is the one not dishing out the money.

We had a similar case years ago where we paid a freelance/(then) friend of mine as a shooter on a 3-day gig. My company was hired by a multimedia designer, who was hired by a broker who actually had the contract. Shooter was 4th on the list of mouths to be fed. Payments were WAY late, but shooter was paid for what he did. (Follow lots of other threads about being a business which at times includes being a bank.) We then had a re-shoot and I told him the situation about late pay and he was cool. After 60 days he called the main client (skipping the 2 guys above me) demanding pay. Well…. talk about awkward. Here, they had paid the broker – even for the re-shoots! I caught heck, lost a client, lost all future work and broker refused to pay nearly $8K for the re-shoot citing damages. This was bad from every angle.

Of course that shooter never heard from me again, but I lost bigtime. You would be totally out of line to talk with anyone other than your employer/customer.

Steve

[Chris Blair]

Yes I tire of the whiny posts from Aaron, and I agree it would be unethical for him to go to client B for his money.

But I have to say that if what he routinely reports about his employers is actually true, they don’t sound like particularly likable folks, or particular scrupulous business people.

So, I also see where he’s coming from in believing when people don’t speak up about others that run businesses like that, bad things inevitably happen. Naturally, a $650 bill isn’t much to get upset over, but if a company treats a small bill like that, it’s likely they’re no better with larger ones.

I’ve learned there are basically two types of business owners. Those that have a passion for their craft or service or art; and those that have a passion for money.

The ones that love what they do are dedicated to producing the best work they can and treating their clients, employees and vendors with respect and integrity. The ones that love money usually look for and start businesses they believe can make them the maximum profit while exposing them to the least amount of risk. They rarely put clients or vendors or employees before money. They’ll pay themselves before paying anyone anything they’re owed. The person that loves their craft will pay everyone else before even thinking of paying themself.

Just so Aaron doesn’t feel bad. We had a client (we’ll call them Client A), who contracted with us to do work (we’ll call us Vendor B). We demanded a subsantial deposit for the work, got it, then got stiffed for the remaining portion of the bill, which is over 6 figures. You read that right…6 figures.

We waited roughly 150 days before suing, won a default judgement when the company didn’t even send an attorney to the hearing or respond to any of our attorney’s inquests…yet we still have to go “find” their money without the aid of the court. This after we have documented proof that after the owner of the company (the guy we’re suing) sold it in January of this year, he proceeded to pay himself $700,000 in salary from January to March (1st quarter) because his company was still winding down it’s operations. This after his attorney claimed the company was “insolvent.” They even reported a profit for the first quarter of this year on their quaterly statement! And…he owns an acquisition/venture capital firm that’s headquartered in the same building as the previous company, and on their website it declares it’s a $100 million firm!

So maybe that will make Aaron fell a little better about his situation, but it likely won’t make him feel any better about Corporate America. When it comes to money, it compels a lot of people to do things they wouldn’t think of doing when money’s NOT involved.

Chris Blair
Magnetic Image, Inc.
Evansville, IN
http://www.videomi.com

[Aaron Cadieux]

I think you’re unfairly comparing my most recent post to past posts. I don’t think my initial post was whiny at all. It was very matter-of-fact and to-the-point. And the fact that I named the company withholding payment is my own problem. Everyone on the cow thought it was a stupid thing to do, and they’re probably right. But what do people on the cow care if I lose my job because of it? In fact, they should be happy to know about a company that fails to pay their invoices, that way, should they ever be in a position to potentially do business with that company, they’ll be prepared for a very late payment.

[Chris Blair]

Aaron…I’m on your side on this one. And yes…I was referring to past posts…not this one. I think what people are trying to say is that you have to pick your spots on a lot of these issues…and you have to be aware that there could be a whole host of reasons why it’s taking so long to get paid.

We typically pay vendors BEFORE we get paid on most projects. But when projects get into the $20,000 and up range and we have a lot of vendors involved, we sometimes are at the mercy of the main client. We always get deposits, typically either 33% or 50%, but we typically don’t use that for paying vendors. In this economy, it’s not unusual for it to take 120 days to get paid. Does it suck? Yes. Does it do any good to bypass your client (in this case your employer) and go directly to paying source? Nope. It’ll just piss people off and you might not ever get paid.

We used to do work for a national company…VERY well known in it’s industry. We annuaully did over half a million dollars in revenue with this one client. They were woefully slow-pay, but always did eventually pay. Once, when we told them we were going to stop production and not release any more work until they paid us, their VP of Marketing told us, and I quote; “I wouldn’t recommend that. It’ll just piss off the owner and then he’ll never pay you.”

Knowing our past dealings with the CEO/Owner, we pretty much believed them. We stuck it out and eventually got paid, albeit months later.

So while it’s tempting to try to expose people that take advantage of others when it comes to financial dealings, it can also be professional suicide. And yes…I remember when $650 was an important chunk of change to me when I was freelancing…but in the large scheme of things, it’s really not enough to stir up the waters so to speak.

With our current issue with the non-paying client, I’ve posted on blogs and forums about the issue and have been sure to name this company and their owners, and I’ve also submitted them as story ideas to news magazine shows and large newspapers, since there are at least 4 other companies they’ve stiffed for similar amounts (we found this info while searching for other lawsuits filed against the non-paying client), and they’ve also taken tens of thousands of clients money and not delivered promised products and services, which amounts to fraud. This has been going on since last summer…a full year…yet not one news organization has picked up on the story…not even in the city where this company does business and it’s owners are prominent citizens.

So I guess the point is that the when you see the court system and news organizations not caring about a company that’s bilking it’s vendors and customers out of millions, surely nobody is going to take notice when a small company runs roughshod over a few employees.

I’ve always believed that EVERY job is a valuable learning experience…ESPECIALLY the crappy ones. So take what you’re learning from this and don’t EVER do it to anyone else. That’s probably the best that will ever come from it.

Chris Blair
Magnetic Image, Inc.
Evansville, IN
http://www.videomi.com