Forgot your password?
typodupeerror
Businesses The Almighty Buck

Ask Slashdot: How To Collect Payments From a Multinational Company? 341

Posted by timothy
from the greedy-europeans-all-they-want-is-money dept.
An anonymous reader writes "I run a small dev shop focused on web development, based in Europe. For the past six years we've had lots of successful projects with clients from CEE, Western Europe and the U.S. One of our main clients was based in the U.S. We started working for them in 2008, while they were a 'promising start-up' and everything went smoothly until they were bought by a multinational corp. We couldn't be happier to work for such a big player in the market, andwe even managed to get by with huge payment delays (3-4 months on a monthly contract), but now, after more than two years working for them, I have the feeling we're getting left out. We have six-month-old unpaid invoices and we're getting bounced between the E.U. and U.S. departments every time we try to talk to them. What can a small company do to fight a big corporation that's NASDAQ listed and has an army of lawyers? They've been getting a lot of bad press lately so I don't think that will scare them either."
This discussion has been archived. No new comments can be posted.

Ask Slashdot: How To Collect Payments From a Multinational Company?

Comments Filter:
  • by DamonHD (794830) <d@hd.org> on Sunday December 16, 2012 @02:16PM (#42307795) Homepage

    Find a tentacle close to you and say that you have to pay rent so sadly you're going to have to sue said tentacle. Take an an onion and maybe a friendly, competent, but not-massively-expensive lawyer.

    In the UK, any invoice not paid for 21 days beyond the agreed date renders the non-payer liable to liquidation. Liquidating clients is not great (though you should have acted on your credit control rather sooner) but I once had to threaten a major banking client with it and at the end of a memorable Friday I got my very very overdue money and my client got itself a new head of accounts, and I found that I had a few powerful friends inside the company amongst those pleased with my work for them.

    6 months is technically known as "taking the piss".

    Stop doing any further work until you get some sort of staged payment started, or start legal action. If you're entitled to the money and you take it slowly and gently and without grandstanding, you may well get it, and may even keep the client.

    Start credit control earlier in future: that's your responsibility to limit damage.

    Rgds

    Damon

  • Limited Options (Score:4, Interesting)

    by cob666 (656740) on Sunday December 16, 2012 @02:24PM (#42307835) Homepage
    If you are providing ongoing work, use that as leverage. Inform the client that work will cease until they are current, this is VERY effective if there are open issues that the client wants fixed.

    You could also send them an invoice along with a letter stating that the invoice is overdue and will go into collections if not paid within 30 days. You should be able to find a collection agency pretty easily, many of them work by buying the debt from you at ~25 cents on the dollar. Many companies will try to avoid collection as it will impact their D&B rating.
  • by AndyD568 (2796177) on Sunday December 16, 2012 @02:39PM (#42307917)
    I feel your pain. Solution: Pretend to be on good terms with them. Get yourself involved in a critical new project, then halt abruptly right when they need your work the most. Offer them an ultimatum - either pay up all the outstanding money or you are walking. After a brief round of bluffing, you will be surprised at how fast your bill gets paid.
  • by bhlowe (1803290) on Sunday December 16, 2012 @02:50PM (#42307975)
    I would try a carrot and stick approach.

    Add in a ~10% overhead and markup to all invoices.. then offer 3% net 30 payment terms. Most big companies have an accounting policy that says they must take the 3% discount (because it is the equivalent of borrowing money at >36% interest, something accountants hate.) The late fee is a little trickier, but write on the invoice that late fees of 6% per month are added after 60 days. If they complain about a late fee when you submit the invoice, kindly remind them that it only applies if the payment is later than 60 days, a more than fair period of time.

    Lastly, follow up a day or two after you email the invoice. "Hi, just wanted to make sure you got my invoice and check on the status of it.." Make sure you have a name and phone number of the A/P person who will be paying it. Call every day regarding late invoices...

    Good Luck!

  • by Anonymous Coward on Sunday December 16, 2012 @02:54PM (#42307991)

    OP here. The contract was terminated with all the proper notices and acceptances, yet the payments were never settled. I've talked as far up as SVP of software dev and SVP of finance... They always seem to have an excuse, it's always "next month" or "corporate freeze on payments this mont" bs...

  • Send Norbert (Score:4, Interesting)

    by Coeurderoy (717228) on Sunday December 16, 2012 @03:03PM (#42308023)

    In a similar situation a friend of mine sent his "CFO", a very persistant slightly weird looking math professor, who happened not to believe in shoes....
    He went to the company very politely presenting his set of invoices, and various "excuses" sent out in form of emails, and requesting to see his "equivalent" (their CFO), he spent two days comming at soon as they openned the office and leaving when they closed....

    They could have called the cops, and threatened too, he explained that they could, his lawyer was waiting in front of the relevant police station just in case...
    They could refuse to let him see their CFO, he didn't mind the lobby was warm and they had a coffee machine, and he brought newspapers and food.
    They could throw him out, he had friends at various newspapers.

    So he saw the CFO, who tried to explain that there was some reasons not to pay, so he called the office on his mobile phone putting it on speaker...
    And for everything the CFO said the company had three people calling at once, on all numbers they had of anybody, and norbert made if very clear that he would not leave without closing all the loops and the cash...

    Epilog, the company finally nervous accountant sent a payment order to their bank, and a copy to the company (on the insistance of norbert) the company sent a copy to the clients bank and to their bank to make sure that there was no error...
    So they ended up being paid twice....

    The client to "save face" and stop thinking about sent an "avoir" wich means the the company should provide an equivalent discount on future work...

    Of course they never planned to bid on any new projects with this client....

    Norbert got a large box of havanas...
     

  • Re:Name and Shame (Score:5, Interesting)

    by hairyfeet (841228) <bassbeast1968@@@gmail...com> on Sunday December 16, 2012 @03:33PM (#42308161) Journal

    And enjoy your libel suit. Of course it won't matter if they haven't got a leg to stand on and you'll win in court because that will cost you several plane flights and 6 figures in lawyers fees.

    You simply don't work for the big corps as a contractor as 9 times out of 10 you say "welcome" they'll say "mat!" and walk right over you. I have seen guys put out of business because trying to get these greedy fucks to pay is like squeezing blood out of a stone. the longer they can go without paying you the more they can get in interest on the money so they aren't out shit, meanwhile your ass ends up on the breadline.

    If it were me I'd stop all work for said corp and talk to a lawyer. sometimes a letter written on legal stationary will be enough but you better learn your lesson and not do shit for them again or you'll be doing the same tango every damned time the bill is due.

  • Labor Department (Score:4, Interesting)

    by smpoole7 (1467717) on Sunday December 16, 2012 @03:58PM (#42308275) Homepage

    If you're an individual, you can get the US Department of Labor to go to bat for you. They take an EXTREMELY dim view of businesses that don't pay for labor. (I was once on the receiving end from them -- long story, it was dispute with employee who would just come in to work without authorization and stack up hours, then complained when we didn't pay him -- and even though we were in the right in that particular dispute, WOW were they a pain to deal with.)

    As others have suggested, you also do need to talk to an attorney -- but unless the invoices represent many thousands of dollars, it may not be worth it.

    As for the comments here about how corporations can "rip you off" -- the deep, dark secret; the unspoken truth is, if someone won't pay you, your options are limited. Whether it's a neighbor who owes you for a lawn mower or a big corporation that owes you for work and services, you can take them to court, obtain a judgment, then execute same. It takes quite a while, though -- many, many months.

    If the other party *can't* pay you, here's an even deeper secret: you're out of luck. Unless they have assets that you can seize, there's not a court in the United States that can force someone to invent money with which to pay you. I realize that's probably not the case here, but I state that just for completeness. Even if you win a judgment in court, if the other party CAN'T pay you, you have a pretty piece of paper and absolutely no money.

  • by t4ng* (1092951) on Sunday December 16, 2012 @04:36PM (#42308451)
    5) Sell the unpaid invoices to a collection agency and let them worry about it, and never work for the company ever again. You won't get anywhere near what you were supposed to get paid. But it will be off your books and done with, you won't have to worry about it any more, and depending on your local tax laws the loss is most likely deductible.
  • Re:Name and Shame (Score:5, Interesting)

    by Genda (560240) <mariet@got.nERDOSet minus math_god> on Sunday December 16, 2012 @04:38PM (#42308463) Journal

    Plus collection fees. If they don't pay within 3 more months, find out if you can put a lien on U.S. properties. After your final notice for payment, inform them that you have no alternative but fall back on legal remedies to collect your debt. Include the cost of legal representation required to collect on the debt. This may seem like small potatoes to the multinational, but I'm sure you can jack up the potato count substantially. More important you want to get in and out fast, these are flakes.

  • Re:Name and Shame (Score:5, Interesting)

    by Anonymous Coward on Sunday December 16, 2012 @05:19PM (#42308631)

    Yep - put it all together. If you are in the UK, and they have a UK subsidiary, then you can apply to the High Court for a winding up order - you have to serve an order for payment (a "statutory demand") and have some proof that the payment is valid, and if they don't pay within 21 days, you close them down. Brilliant!

    I had a friend who, back in the 90's, served such an order on Hewlett Packard's UK arm. Wow baby did it get their attention!! Because if they don't get it sorted, then they are declared insolvent by the High Court and then their accounts are frozen and administrators are called in. They can dispute it and restrain the petition - or they can pay up rather quickly, which in this case they did.

    He figured he'd never get any more work from them - but at that point he didn't care because he wasn't getting paid.

  • by agm (467017) on Sunday December 16, 2012 @06:02PM (#42308823)

    That would be my first instinct too. Why would you continue to work for them for 6 months without being paid? That's bonkers.

    I had a client that would always pay late, so I told them that if the payment was one day overdue, I would not come in to their offices and do the work they had contracted me to do. They didn't like it at all, but it ensured I got paid. They were so slack at paying that I changed the terms of my invoices from "20th of the following month" to "pay on invoice". Their CFO sees it as standard practice to withhold payment for as long as possible. I saw it as standard practice to withhold my services if I wasn't paid. They were the ones who needed me to work for them - I had other clients who paid as well and on time.

    P.S. I don't see what refusing to work unless you are paid has anything to do with being pro or anti unionist.

  • by Zero__Kelvin (151819) on Sunday December 16, 2012 @06:25PM (#42308909) Homepage

    " I cannot begin work until we get at least a partial payment for the past invoices""

    Make that: "I cannot begin work until all past invoices are paid in full". You can't stop a problem from continuing if you endorse the behavior on any level. Also, unless it is true, don't claim it is due to a "superior's" edict. If you want them to be honest and straight-forward with you, you need to do the same. otherwise you're a hypocrite.

"I got everybody to pay up front...then I blew up their planet." "Now why didn't I think of that?" -- Post Bros. Comics

Working...