Collect your money

The subject never gets old and you can’t talk about it enough. Collecting money. Architects and engineers are horrible at it!

There are several reasons for this problem, including:

  1. Poor self-image. If you don’t think you deserve to get paid – guess what? You won’t get paid! That applies to so many architects and engineers who willingly take the abuse from bad clients who mistreat them. As someone who is a real estate developer myself I can tell you 80-90 days to pay a professional service provider is NOT normal. I feel bad if we take 30 days to pay ours. You should not work for a client and expect to be treated poorly! You deserve to be treated well!
  2. Can’t get bills out. Some firms simply won’t send bills out. A geotech we have used, for example, has sent us some bills as long as eight months after the service was provided. We have to call them and ask them to bill us. Sorry, but that’s ridiculous! Should never happen. Your clients should not be calling you asking for an invoice. And the longer you wait to bill – the less likely you’ll ever collect. Hire someone if you have to and get the damn bills out.
  3. Won’t use “good cop/bad cop.” The actual people who are the front-line service providers (i.e., principals and PMs), should not be the ones asking the client to pay them unless there’s a problem related to what they did. This is the domain of the F&A people (finance and accounting). Use them for it! Protect the relationship from awkwardness by putting your accounting folks out there to do your dirty work. They don’t mind. They really just want to get paid so the firm can pay its bills!
  4. Won’t follow proven, established procedures. There’s a science to this stuff. We have written a million articles on it as have many others. Do certain things and you’ll get paid faster. Don’t do those things and you won’t get paid. Don’t over-complicate it and don’t act like you are the first firm in the world to deal with this problem. You aren’t! There’s a process you need to follow. Your bills need to look a certain way. Certain things should generally happen at certain times. And by the way – don’t let any principal who wants to stop the process stop it. That’s bull.

This week’s issue is all about our Hot Firms and Best Firms to Work For. These companies are generally much better business people than the norm for our industry. Look at how they do things. Copy. Repeat. And then maybe we can all be partying together at next year’s Black Tie Dinner and our Hot Firm Conference and A/E Industry Awards Conference (we’re at the Arizona Biltmore in Phoenix this year!).

Meanwhile, collect your money!!

Mark Zweig is Zweig Group’s founder and CEO. Contact him at mzweig@zweiggroup.com.

Posted in Articles | September 9th, 2016 by