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standard payment and reminder terms
Thread poster: Alexander Onishko

Alexander Onishko  Identity Verified
Local time: 22:51
Member (2007)
Russian to English
+ ...
Nov 19, 2007

Dear Friends,

Please give me advice about the following:

1. What is the normal "business standard" term of payment after an angency receives the invoice if the term was not agreed upon beforehand.

2. What is a normal term to agree upon? For example, if the agency says "we will make payment within 40 calendar days after receipt of the invoice" - is it industry standard or is it a too long term?

3. After how many days after the supposed "standard term" of situation (1) will it be polite to send a reminder?

4. After how many days after the agreed upon term of situation (2) will it be polite to send a reminder?


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Margreet Logmans  Identity Verified
Netherlands
Local time: 21:51
English to Dutch
+ ...
Could be country-specific Nov 19, 2007

Within the European Union, 30 days is the standard.

Personally, I send a reminder 7 or 14 days after the date I agreed on with the agency (depending on a number of factors, including payment history, relationship with the agency/client, amount of money, client location, etc.)

And then a reminder every passing week....

My 2 cents!

Best,
Margreet


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Alexander Onishko  Identity Verified
Local time: 22:51
Member (2007)
Russian to English
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TOPIC STARTER
Thank you for your advice, Margreet! Nov 19, 2007

Thank you for your advice, Margreet!

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Oleg Rudavin  Identity Verified
Ukraine
Local time: 22:51
Member (2003)
English to Ukrainian
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Alexander, you may find the link useful Nov 19, 2007

http://ec.europa.eu/enterprise/regulation/late_payments/implementation.htm

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José Henrique Lamensdorf  Identity Verified
Brazil
Local time: 16:51
English to Portuguese
+ ...
Usual industry standard Nov 20, 2007

The usual translation industry standard is 30 days. Almost every translation agency worth working for adopts it.

I avoid outsourcers that practice longer terms, because my interpretation of these is one or more of:

1. They are reoutsourcing work from another (maybe even blacklisted) agency who will hopefully pay them in 30 days.

2. They have cash flow problems, and want to build a positive balance at your expense.

3. They have no intention to pay you, just want to buy more time to vanish completely before you get wary.


Some very reputable translation agencies have a preset payment calendar. They'll make a list of payment dates for the whole year, often something like every second Wednesday. They'll pay on the first such date after the 30 days have elapsed. However sometimes, when you have several pending jobs with them, they might anticipate a few of them, so you'll get paid for these in actually less than 30 days.

It is polite to send the first (gentle!) reminder a couple of days after the agreed due date. Human error is possible, sometimes the payment method doesn't work because this specific payment exceeeded some unexplainable limit, or they are still awaiting some file from you by e-mail, while you uploaded it to their FTP site as per their instructions a month ago (all these already happened to me). The reminder will help to sort out the situation.



[Edited at 2007-11-20 16:23]


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Nikki Graham  Identity Verified
United Kingdom
Local time: 20:51
Partial member (2003)
Spanish to English
A question for anyone who knows the answer Nov 21, 2007

Alexander Onishko wrote:

1. What is the normal "business standard" term of payment after an angency receives the invoice if the term was not agreed upon beforehand.


If you have not agreed a term of payment at all, and do not therefore state anything about the payment period in the invoice, can the customer actually take as long as they like, or is it understood in the EU that no agreement means 30 days?


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MariusV  Identity Verified
Lithuania
Local time: 22:51
English to Lithuanian
+ ...
do it simple Nov 22, 2007

"30 days after invoice". And ALWAYS agree on the payment term in advance, i.e. before accepting and confirming the job. Best of all (if it is a new client and you might feel you do not fully trust all can go well), would be to ask them to insert a sentence into the PO (Purchase Order) that "Payment will be settled within 30 days after delivery of the job indicated in the PO". And do not confirm nor start without a PO (unless you know the people and can trust them on the basis of a verbal agreement).

If they ask for 40 days or more, OK, you can agree on that too (if you can afford to wait that long to credit them), but a new possibility here for you - do not be "afraid" to ask for a higher rate then (at least + some 5-10 per cent)

As for reminders - I usually send a reminder after 2 weeks after the due date (a polite reminder). If no reaction, I wait for 2 more weeks and send a strict reminder giving 4 more weeks to settle and mentioning a possibility of legal actions after that date.


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Alexander Onishko  Identity Verified
Local time: 22:51
Member (2007)
Russian to English
+ ...
TOPIC STARTER
Debt collection and debt collectors Nov 22, 2007

MariusV wrote:

... mentioning a possibility of legal actions after that date.



In the books and guidelines on debt collection and writing reminders it is mentioned that "... do not threaten legal action unless you intend to take it, as it will make you look weak andindecisive."

Indeed, how can you really file a legal suite say in the UK if a client from the UK ows you say 1000 Eur.

I belive such suite will cost you much more than the due amount.

Is it possible instead to mention the possibility of recruiting a collection agency?

I believe it is more realistic?

What do you think?

Also, can someone give an advice of an approximate cost of the services of a collection agency?

A most important thing I am interested in is that (1) you have to pay collectors in advance a fixed fee ? OR (2) they will take some percentage of the total amount after they have it form the debtor (at your expence) OR if they will returm you the whole amount and will charge the debtor some additional amount for tehir services.


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