CreditXS commercial debt collection service

How to Tackle a Disputed Invoice


Your work with a customer is going extremely well, until they get the invoice, that is.

Unfortunately there will be times when customers either don’t agree with your fees or claim they weren't happy with a service, or say that products were faulty or delivered late. One of the many challenges small businesses face is tactfully, but firmly, securing payment from customers who have disputed an invoice.

When this happens, however tempting it might be to try to avoid conflict, so that it doesn’t affect payment of future invoices, you must not ignore the problem of a late disputed invoice. It certainly won't go away on its own and it's far better to tackle the issue quickly before positions become entrenched.

Below are some of the most common reasons invoices are disputed and the best ways to handle them.

 

“I’m not happy with the work.”

The customer may be unhappy with services received. The finished work may not look like the customer had envisioned it would. Services completed might not have produced the results they hoped for. When this is the case, the customers’s first reaction is to refuse payment.

If the work was completed as agreed, but didn't have the results the customer hoped for then (unless your contract was on the basis of results), remind the customer that you were contracted to supply the service and not the results.

If a piece of work didn't come out as the customer imagined, offer to make changes as necessary. Most proposals include revisions and this can be a key part of the customer’s end happiness. Probe with questions about what they specifically don’t like or would like to see different and do your best to work with them. Try to reach an accomodation on the costs of any extra work necessary to reach an end point the customer is content with.

 

“The products were faulty.”

If the products were genuinely faulty, then ask for the opportunity to replace them and recieve back the faulty goods. If the faulty goods were used, then it seems that they were good enough to use and should be paid for. If the customer is able to prove that the goods were below-par but still good enough to use at a pinch, perhaps you can agree a part payment.

 

“It was delivered late.”

Unless it was agreed upfront that there was some kind of penalty clause for late delivery, then you can insist on payment in full. You might consider allowing the customer to return the goods (if they are not perishable) for a re-stocking charge.

 

“I never agreed to this.”

Never begin work without a contract. Your Terms & Conditions protect you and ensure your livelihood. Having a copy signed by the customer is solid gold if your business ends in dispute as it shows exactly what they did agree to.

 

“I can’t pay this right now.”

Customers place an order, sign a contract or your Terms and Conditions and perhaps even give you a deposit but ultimately come up short when you send your final invoice. This is rare, but does happen on occasion. When a customer has placed an order, they are under a legal obligation to pay you for the services rendered or products delivered. If the payment is late, you have a legal right to add interest and recovery costs to the overdue invoice.

If you're getting nowhere with a late payer, why not try our online debt collection service? The fee only becomes due when a payment is made to your account and you can even add our charges to the total the customer has to pay you.


It’s Good to Talk

The key to any resolution is communication most disputes can be handled with a polite, but firm conversation. A misunderstanding can escalate quickly, especially when a large amount of money may be on the line for a customer. Keeping your cool will help you to ensure that you come out on top in the end.


How we can Help:

Debt Collection

Outsourced Credit Control Service