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Not Getting Paid: Beginner Mistakes
I was reading about a young computer technician on the Technibble forums who had encountered some issues during his first paid computer repair job. This computer technician was asked to do some virus removal work, he quoted $50 USD and the client accepted.
Later that night, the computer technician arrives as the clients house, removes the virus and even fixes the clients other computer which was having problems. When the time came for client to pay, some problems arose.
The first problem was that the client asked why he should pay the Technician since the software that was used is freely available on the internet and that the client could have done it himself.
The second problem was that the client said that his wife has the money and she is currently “out”. The client said he would bring the money to him later that night but never showed up for that appointment.
Now that computer technician is having problems getting paid.
These are mistakes that any new computer technician could encounter and this is what he should have done (and you can do) to have protected himself.
The first issue was that the client said that he could have done the work himself. To me, this sounds like the technician didn’t deliver value-for-money in the eyes of the client – even though he did do the job correctly.
“Value for Money” is an interesting view because it is differs from person to person. The fact that he fixed the problem at the price he said he would should have been enough for most people. However, this particular client knows a little bit about computers and felt what the technician did was within his capabilities. When the client said “everything you used, you downloaded for free and I could have done it myself”, the technician replied with “why didn’t do you do it yourself?” making the client realize he didn’t do it because he didn’t know how to.
The best response to such a question is to tell the client that they arent for paying you to press buttons, they are paying you to know which buttons to press. Sometimes that is enough for them to get the idea but if they are still not getting it, I sometimes go onto say that they are paying for my education to get to this point. They are paying for the years of me working on computers without getting paid so when I do come to work on their computers, I know exactly what to do. There are also other factors that they are paying for such as fuel, insurance, hardware and other business overheads.
If I am onsite at a residential client’s house and I fixed the problem fairly quickly, I still need to charge for the full hour so I can cover driving time and petrol. So what I usually do is ask the client whether they would like me to check the Windows updates, look for viruses or show them how to do something on the computer. If the client is a business client and they need the computer I am working on, I usually just leave. Letting them get back to work is usually more important to a business client. I have written an article on this subject some time ago if you want to know more.
The next mistake was letting a residential client pay later. If the client is a residential client and I haven’t done any work for them before, then I will only accept cash and it must be done when work is completed. If I have done work for them before and know them to be good clients, I will accept checks too.
Unfortunately, the client in this story sprung the payment issue on the technician only after the work was done so the technician couldnt accept cash or check then and there. However, he should have had a signed work order saying that the client is happy with the work that was completed. This would have been proof that the work was done to satisfaction and that he should be paid. This is great to have if the technician wants to take it to small claims court. There is also a psychological element of having something in writing since the client knows that it is all documented and it will be difficult to debate. Therefore there is less of a chance of ever needing to bring it to small claims since they know they are provably in the wrong.
In the same forum post, the technician said that he learned to not judge a book by its cover since the client looked fairly wealthy. He was in a nice neighbourhood with dual 28″ HDTV’s setup as monitors on the wall and a Quad Core system.
It is a not a good idea to assume that you will have no problems getting paid by wealthy customers. In fact, the most money I ever lost to a single client was the wealthiest one of them all. Unfortunately, this was a long time ago when I was first starting out so I didn’t have the right paperwork in place at the time either.
Another thing to keep in mind is that someone can be “wealthy” and “cheap” at the same time. In fact, many of them get there by keeping their money close to them and saving where ever possible – including negotiating the price with you.
Last but not least, this technician charged $50 USD for the job which is a good price for a beginner if it was hourly. However, it was a fixed price which is actually cheap. Remember, cheap prices attract cheap customers, even if they are the wealthy kind.
In conclusion, always provide value, only accept cash from new residential clients, have the right paperwork in place and don’t judged a book by a cover. If you follow all of this you would have significantly reduced your chances of not getting paid.
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Wow, is $50 really that cheap? I might have to revisit our price scheme.
Excellent article, Bryce. I couldn’t have expressed it better myself-:) I worked on a newly divorce’s computer a few months back. Her and her kids used to live in a mansion with the ex-husband, who sadly, was one of many victims of the Bernie Madoff’s Ponzi scheme and she was ‘down-sizing’ from a mansion to a five bed-room house which still was huge and she was doing quite well financially. Upon my first visit, she had one guy putting up a flat screen tv in the living room and me to work in the computer room she had set up. One desktop she had turned into me working on two additional desktops that belonged to her children as well as three printers and setting up her wired network setup and guess what? She expected me to charge her less because she was going through her difficulites! When I overheard her asking her kids if they wanted granite countertops in the kitchen, I quickly changed my mind at cutting her a break. Wealthy folks can be cheap oftentimes! It’s so true! You hit the nail right on the head, Bryce!
Does it really matter if you use a boot disk or an application within windows? Most people just want the virus removed. I have made a disc with a HTML interface that has a lot of my common tools on it. But if I used a thumb drive it would be just as effective. I have found that my personal interaction with the customer has a lot to do with how they receive me, along with competent work. New Tech has to learn how to deal with people, and decide what he is worth. That in my opinion is one of the fun parts of owning your own business. The experience and freedom.
This unfortunately happens very often, mostly to new technicians that aren’t yet a legitimately registered business, or present as someone who is not. Some people take advantage of this with the mind set “what are you going to do about it” thinking they have no legal structure as a back bone.
Here in NY you don’t have to have a signed invoice or work order to put someone into collections or court.
I do always recommend that new technicians do some homework. Spend a few dollars on your business, and at least register a DBA and TaxID. TaxID numbers are normally free.
When I get a call on the phone and an appointment is made, I make it a point to tell them that there will be a work order(Technibble’s Business Kit to be precise) to go over before I do any work of any kind. And I added a line at the bottom that says my company expects payment at the end of the job in cash and have them sign it. So far no problems, but then, I’ve never had a wealthy client to work for yet. Most people are out of work but they want their computers up an running as inexpensive as they can get. Fortunately, that has been a plus so far. Great work on the article!!
He could have done it himself? lol.. erm, then whey did he call a tech? I would straight tell him that in his face.
Also, never ever leave without getting paid. Tell them when they fist call that the payment is due right when the repair is done. Especially for residential customers.
Yeah, I hate cheapo clients. If that guy had said that to me( he could have done it himself) i would have told him that i can do my own weeding but i pay someone else to do it for me.
game set and match. give me my money.
Another insightful article Bryce! People always undervalue the cost of labor and sometimes techs forget the importance of paperwork (This is how TechCrunch and its owner were screwed over by Fusion Garage in the whole JooJoo tablet fiasco).
Not to be harsh against the novice technician, but he needs to differentiate himself from “pizza techs” especially when it comes to viral removal. There are many manual tools to remove viruses (Autoruns, Process Explorer, even Linux for manual viral deletions) that would have separated him from simply the button pushers (or those who know which buttons to push).
Nevertheless, he should have been paid, however I bet if he used the manual tools it would have made the cheap rich customer have a little more respect for his line of work and would have potentially increased the likelihood he would have been paid, no questions asked.
You will always have the most problems from people with money. I hate to say it but you don’t generally get to be wealthy by being a good person. Always portray yourself as a professional, be friendly but confident when dealing with people who feel that they are better than you.
Bryce great insight. Unfortunately it’s a hard lesson for a new tech and like many of us we have learned the hard way as well.
Something that I discovered that works really well is to ask the client (whether a new client or existing ) is to email me (when possible) or write down a list of issue(s) they are experiencing. This gives both of us a reference point should the scope of work need to change in mid-stream.
It’s a simple way to protect yourself.
Or just…open a command prompt and start running random harmless things that will make you look like an uber-1337-technician.
ping
dir
cd
systeminfo
ipconfig
LOL
May I suggest roofing nails where his driveway meets the road?
Mobile EFTPOS units – worth every dollar when the client says “no cash on me”. That’s ok, I take credit cards and bank cards for your convenience.
I’ve struck the “wealthy” and “cheap” and i’ve also struck the “poor” and “cashed up” so you never know what’s behind the door regardless of what socio-ec area you are in.
Well unfortunately this story is about me. I learned the hard way. Surprised it turned into one of Bryce’s front page articles. The guy’s wife finally did come by and pay me. Then apologized for her husbands behavior. I got really lucky. I now document everything on paper.
Unfortunately this is one of the reality’s of running a business. I appreciate every honest hard-working client I get and I make sure they know it.
1. In the back of my mind I’m ready for that first customer that doesn’t pay.
I figure if I only get stiffed for my time, I’m in better shape than if I had spent funds on hardware.
2. Life is too short to become bitter and obsess over a deadbeat.
3. Cross that customer off the list forever (even if they do eventually pay).
4. I can hear you all now shouting at your monitor that “time IS money” or something like that.
To be practical, we have limited options in this type situation.
Of course follow up with Bryce’s collection letters, but much beyond that it turns into a case of diminishing returns.
Thes funny, i just did a repair for a guy, IDE laptop drive upgrade, data recovery attempt. The guy is running for County Circuit Judge and didnt want to pay for the repair because the data retrieval was unsuccessfull, dude has the money to chock up but instead he jsut wanted to pay my 50$ diagnostic, pick up and drop off fee and be on with it. so being that he is a local politician i undersold myself and charged him 50$ for the upgrade and system optomization… basically i charged him what the drive cost me in good faith hoping hed send his wealthy buddies my way, not sure if this was a mistake or not….
Several of the home brew techs in my area have started asking for “deposits” along with having the customer sign a work order before they even sit down at the computer. I don’t know if this is considered bad business but so many are doing it around here it’s unreal. I asked why and a few of them said because of this exact reason. Too many people in this area thought it was ok to shaft the poor techs once they were done. One even had a gun pulled on him when he tried to collect payment. I have some horror stories of my own.
“cheap prices attract cheap customers”
I love that!
Like Mike Smith, I just lost out to a business client. However this was the first time in 11 years, so not a newbie. I have tried all options apart from blackmail (I have all information from all clients computers). So now I have to understand what ‘Blain’ has written and move on, understanding that sometimes your going to lose.
Thanks Bryce some times it helps to talk it out with others, we tend to work in a very closed sector.
“Also, never ever leave without getting paid. Tell them when they fist call that the payment is due right when the repair is done. Especially for residential customers.”
I understand that theory, but how’s it work out for you in the real world?
* It drags on until the customer contacts the law to remove you?
* You tell the law what happened, the customer says it didn’t happen that way.
* The law tells you to take it up in court, and then tells you to leave the property.
Bottom Line: You left without getting paid and you wasted another hour or two.
Is that strategy really a winner?
This has happened to me except with a business client and with a few thousand dollars. The business client had been a good customer for about a year, paying on time, and using us regularly. From all appearances and comments the client was happy with us and the work we performed. One day he bailed on a 2500.00 bill. Simply would not pay it. Was upfront about it too. “I’m not paying.” He knew he would loose us but I guess he was prepared to find another tech firm to support him.
He knew the “point of pain” so to speak. The point at which we would write it off because it would be more expensive in terms of legal fees and time to recoup the money.
These are some cute stories about non payment:
Last paragraph in the Early Life section- http://en.wikipedia.org/wiki/John_B._Kelly,_Sr.#Kelly.27s_early_life
http://www.lecraic.com/2009/01/29/knowing-where-to-tap/
Lastly I think we all get beat at one time or another. There are unscrupulous clients everywhere. Mitigating their impact and learning to spot them early is about the best I think we can do.
great information as always. and great replies from the rest. most people can be down right rude and stupid.
Michael, for the record I am not having a go at you. Its something that can, and often does happen to any new technician so thats why I wrote about it. Anyway, you asked for advice on the forums and took it on board with a good attitude. Because you have a good attitude, you’ll likely go far.
Just because a client has a nice house and lots of fancy toys does not necessarily mean they have money. Many people live on credit and live from pay cheque to pay cheque. No sympathy from me when they try to wrangle a deal.
With new and unknown residential clients I have a policy of requiring payment in cash before I’ll even enter the home. I’m upfront about it from the very first call so it doesn’t come as a shock. It is non-negotiable and I pass on clients that object. When a business relationship does develop then I move to a standard pay me when the job is finished.
“I could have done that myself” – No you couldn’t have… because you didn’t.
“Why should I pay you for something so simple?” – It wasn’t simple until I showed you with my 10 years of experience.
“My wife has the money” – I should’ve expected that shit from a bitch like you! Now, put yo hands and shut the frick up! This is a holdup holmes!
Very well written Bryce. Great information. You suggest some very good tips to get paid with what you are working for. I like to add one point from client side, they are always looking for cheap services so give proper estimation to them.
make no mistake that customer requested a service and promise to pay is implied just like your car getting repaired this guy was looking at all angles to get out of paying tech.
Should have wo and TOs though though I agree.
1. My Leaky Roof Story
I done computer work for a customer who I told them what it was going to be. They then tried to pull a leaky roof story to defend themselve from not paying the full amount.
I was griping and it was my right to gripe for these cheapeskate.
The funny thing about these people, they brought roach into my work site. I was having a ball over killing it.
2. Mr. Pretending To Be Your Friend
I didn’t fall for it because friend take a long time and his cheap attempt failed me. Pay me MORE!
This is one of the reasons I only do work for home users that have a referral. I find that they are cheap and when you do get paid they expect free support for life. I find that newbie techs go after this customer base.
To Michael in comments, Nice to see that you got paid. I know it tough but I would only accept residential work from referrals. never had any problems getting paid from a referral.
I was working out at the gym in my girlfriend’s town and they went down on their legacy system. I quoted them diagnostics and consult and they accepted. I am out 180 bucks…. needless to say i bought bryces’ contract forms and such and now i have no problems… but im pissed. infact i dared them to charge my card for working out monthly… dared them!!!
i even adjust my prices on the recession i give away free hours at a time if i deem it worthy. I dont believe everyone has the funds for it but think of it this way… if u gave ur car to someone and they fix it. dont expect to drive ur car off without paying when you wanted the work.
If a customer refuses to pay I like to take the computer in question and smash it over their head. :) heh. Seriously though, setting a set price point when onsite, and then having them sign a one time service agreement form should help deter any non paying nonsense.
True! Some of the wealthiest-appearing customers are the stingiest, and those who live in trailer parks are willing to tip and send referrals… I would rather work for the latter.
“they arent for paying you to press buttons, they are paying you to know which buttons to press” – to be said with a wry smile
In regards to a “breaking point” and deadbeats, getting them to pay is as simple as a small claims judgement followed by liens on various pieces of business property. You know, like perhaps a car dealer finding he just lost a sale on a new car sitting on his lot because you have a lien attached.
If you REALLY want to get the deadbeats by the balls, then consider putting a Mechanic’s Lien into your contracts. “You don’t want to pay? Fine. The work order you signed says I can hold the computer until you DO pay.” It is amazing how fast the money will fly into your hand.
As always, check your State’s laws for specifics.
Higher rates, besides building your bank account faster, have the built-in advantage of weeding-out most of the cheap sheister’s like this guy.
Can’t pay right now? That’s fine sir… you have 5 business days to get full payment to me. The moment that payment clears, I’ll remotely disable my “wipe drive” command I just installed on your system. I call it my “payment assurance policy”.
Have a nice day now. I certainly do appreciate your business.
;-)
I made a mistake like that too a few weeks back. A guy offered to pay me in fresh shellfish and such if I removed the Vista activation screen. Knowing me as a seafood lover, I took the bait. He hasn’t called me since. Looking back, I don’t really mind, it was simple job.
Work orders are they only way to be with new customers. Although I have had one existing customer forget to pay me but after a quick letter of ‘reminder’ the cheque came.
Also a reminder to everyone to carry a note checker pen as ive had some people try to use dodgy notes, so now I check them infront of the customer.
wow, that’s like the worst thing that could happen, i mean, i know it happens – that’s why I try to stick with small businesses and I try to get to know them first before I do business with them, it would be really difficult to deal with that because us tech people aren’t wired for collection calls.
I had the same thing happen to me! After dismantling this man’s laptop and diagnosing his issues, he didn’t like the price just for parts (with zero markup on my part, mind you). He told me he was able to do the work I did himself and that he wouldn’t pay me. Luckily, he already agreed to and signed a work order.
I should note that I called the police and am planning on pressing charges for theft of service, if their attorneys accept the case. Does anyone have any advice as to if this is a good or bad move?
I have had the same problem on ocasions. I have been doing this for ten years and I can feel when a customer is going to be a problem. Normally when I get this feeling I do a couple of things. I first add/change the password and if it is a laptop I had a password at the BIOS level. When they pay me I remove the password or on the occassion when they don’t want to pay me I mention that I felt it was going to be a problem and if they want the password I need my money.
Sometimes this happens.
That is too bad that happened. But it is better to learn the lesson sooner rather than later. I always make a point to let the customer know that regardless of the time it takes to fix you are charged for an hour up front and you need to be paid prior to the computer being serviced if it is a house call, or upon pick up.
We try to limit our house calls to our established clients. New clients need to drop-off their computer to our shop and pay on pickup. Parts need to be paid for in advance of our purchasing them locally or ordering them… and they can pay for that service via our website so that they don’t have to make a special trip back to our shop.
We have their computer until paid for and hope that if not picked up, it is worth more than (our) cost of the repairs.
I have worked for one company that was in a strip mall and had some walk-in traffic. When they had the chance they moved to a commercial site where they would not receive walk-ins. Less chance of taking fake credit cards, bad checks, etc., people just browsing and killing time, and theft. They didn’t take any money up front and would sometimes get stuck with old trashed laptops (junk) because the client didn’t want to pay for the diagnostic service.