When should we ask for an upfront fee? How much should it be?
Thread poster: Navarut Y.

Navarut Y.  Identity Verified
Thailand
Local time: 15:15
Member (2014)
English to Thai
Jul 31, 2014

Hi all!

I have just subscribe PROZ and wonder when I should ask for an upfront fee? 20,000 weight word count or more? In my country, the fee for 10,000 wwc is quite a large sum of money but in some places, such fee is only a small amount. Therefore, I do not want to make my customer annoyed about an upfront fee if they feel that this should not be any matter.

Thank you!


 

Charlie Bavington  Identity Verified
Local time: 09:15
French to English
Do as you would be done by Jul 31, 2014

How much would you be happy to pay in advance if the situation were reversed?

That much is how much you should ask for.

And it's why I have yet to come across circumstances where I would ask for payment in advance.


 

Sheila Wilson  Identity Verified
Spain
Local time: 09:15
Member (2007)
English
+ ...
From an individual or a business? Jul 31, 2014

Charlie Bavington wrote:
How much would you be happy to pay in advance if the situation were reversed?

That much is how much you should ask for.

And it's why I have yet to come across circumstances where I would ask for payment in advance.

As an individual, I'm very used to paying upfront, or at least paying the minute I receive the goods/services. Nobody ever gives me crediticon_frown.gif. I don't give my clients credit if they are being invoiced as private individuals (which happens quite often when you specialise in polishing English texts etc). The only time I make an exception is if I know (of) the person I'm invoicing.

Agencies, direct business clients, even fellow freelancers, don't expect to pay in advance, as I don't when I'm wearing my professional hat. They all expect to receive an invoice, with or after the work, and time to pay it. I have occasionally asked for (but not demanded) a small 'good faith' payment from start-ups and freelancers if the first job is quite large, but it's the exception rather than the rule.

If I have so little faith in getting paid in full and on time by a company that I feel I have to get my hands on their money in advance, then I don't enter into a business relationship with that company. It's as simple as that.


 

Charlie Bavington  Identity Verified
Local time: 09:15
French to English
Business, business and business Jul 31, 2014

Sheila Wilson wrote:
From an individual or a business?


Pretty much all the comments I make on here, a website nominally for professionals, are from a business perspective. Time was when I would often rant and rave about the irrelevance of comparisons with supermarkets, plumbers, lawyers and the Good Lord knows whoever else in our lives as consumers that people still insist on posting. I even blogged about iticon_smile.gif The legislative framework is entirely different, different rules apply and, in short, such comparisons serve no useful purpose whatsoever, in my view, except perhaps to highlight that there are indeed big differences between consumer and business transactions.

So yeah, I was talking about as a business.icon_smile.gif


If I have so little faith in getting paid in full and on time by a company that I feel I have to get my hands on their money in advance, then I don't enter into a business relationship with that company. It's as simple as that.


100% agree unequivocally.


 

Anton Konashenok  Identity Verified
Czech Republic
Local time: 10:15
English to Russian
+ ...
It depends Jul 31, 2014

If the customer is potentially unreliable and/or the legal means of protecting your interests are clearly inadequate, this threshold may be arbitrarily low, even zero. On the other hand, even for the most trusted and reliable client I would demand a down payment if the project is to take more than a month of full-time work - in this case, I would ask for one month's worth of my fees in advance, and then bill the customer on a monthly basis.

 

Edward Potter  Identity Verified
Spain
Local time: 10:15
Member (2003)
Spanish to English
+ ...
Depends on the customer Aug 1, 2014

If you have a new customer, immediately check them out on the Blue Board. If they are not there, it is a bad sign.

The second thing to do is google them to see what you can find. Research further in whatever way you see fit.

If you are having trouble getting information on them through google and otherwise, it is a bad sign.

If you do find them, and they have a good reputation, you might just trust them, then do the work. Make sure you do a good job.

If you can't find any information on them, or the information is bad, ask for at least 50% up front and see what they do.


 

Arianne Farah  Identity Verified
Canada
Local time: 04:15
Member (2008)
English to French
I concur Aug 2, 2014

As the others have mentioned; it's a case by case decision.

I do my due diligence when it comes to a company; individuals tend to be people I know or friends of people I know. I've never actually asked for advance payment.

I have however negotiated a 15-day net payment term from a company that had a so-so blueboard record and who usually paid at 60 days. They respected the terms for the first two years (they were a sporadic client, large one-off projects). I kept the terms in my invoice since they had been accepted. Very recently, I had another large, urgent project with them; I didn't receive payment after 60 days (I didn't feel the need to apply my more stringent requirements after almost 3 years and thought my invoice might have been mainstreamed in the system after 3 years) - I emailed the PM + a few others and received a profuse apology and explanation that the PM had forgotten to submit the invoice, a referral to the emails of the people in charge of accounting if ever it happened again and I wanted to know who to contact and, within 12 hours, a scan of the check that had just been mailed out. Needless to say, I was happy with the exchange- human error happens and within 12 hours of my pointing out an issue, I had an explanation, a resolution and an avenue in case of future mishaps. I could tell they were in full reputation protection mode; and I believed them when they said it was a mistake since it was immediately remedied.

All this to say, trust your research. Don't extend tens of thousands of dollars to strangers. A company that has had trouble but recouped is generally better than a new company that runs into problems for the first time (basically, agencies that were burned and survived will be much more protective of their reputations; newer agencies will tell you they're 'always on time' so why are you complaining, even as they're late...).


 

ma_nau
Macedonia (FYROM)
Local time: 10:15
English to Macedonian
+ ...
No rules about it.... Aug 2, 2014

Even though it's not wrong to ask for upfront fee, the practice is to be paid afterwards. My experience is that you could ask for it, especially if it's a company you've worked with before and you have a large translation.

 

Tina Vonhof
Canada
Local time: 02:15
Member (2006)
Dutch to English
+ ...
Rarely Aug 3, 2014

I have asked for payment, or half of it, up front only twice over the years. These were private clients in another country for whom I had no business address, website, or any other way to verify their identity. However, in both cases, they offered to pay in advance, so it was easy to simply say yes.

 

Navarut Y.  Identity Verified
Thailand
Local time: 15:15
Member (2014)
English to Thai
TOPIC STARTER
Thank you very much! Aug 3, 2014

Thank you for all replies. They are very useful suggestions. ^^

 

Cathy Flick  Identity Verified
Local time: 04:15
Member (2003)
Russian to English
+ ...
Full amount in advance if unknown Aug 12, 2014

If I can't find any reliable information on an agency or if the client is an individual, I require full payment in advance (verified by my bank after deposit) before I will set a delivery date. This saved me recently when a scammer wanted to hire me. I thought both he and the job were peculiar, but I've worked with eccentrics before. I was never in any danger because I refused to even schedule the job until payment was verified. He seemed unconcerned about my continuing to lengthen the deadline - I had told him that if I received payment by the 15th then (if the payment was confirmed) I could start on the 4th of the next month and deliver by the 11th. He said he was sending half the money early in the first month but I reminded him of my terms. Nothing showed up by the 15th and so I told him I was already booked for the original deadline and could not offer a new deadline until I received and verified payment. So I didn't lose anything, I kept accepting new work while he dawdled. If he had sent a certified check (as he oddly said he would, twice, none showed up), I would have called the bank on which it was drawn to verify the check before depositing it, and then would have waited for my bank to verify that they had received the money from the issuing bank before putting the job on the schedule. I would wait at least a week after the deposit was posted - they can take that long to get a bounce even domestically. I finally cancelled the job when some more digging revealed it was a known scam (found him in the Proz scam wiki) and the address he had given me was a Catholic church in California rather than an apartment building! Not sure what he was planning, but nothing would have worked on me with that policy. I would have mailed back an overpayment, if that was his angle, and if he cancelled for a refund- he would have had to wait for the verification process before I would have refunded anything (minus a kill fee). I'm not a bank.

I do not accept PayPal for such advance payments. If they fund the payment with a credit card, they can do a charge back (reversing the payment from their end). So that is not a verifiable payment method for my purposes.

Note that even with the scammer, I was polite and just laid out my terms. You have to be willing to lose the job. But if there is anything potentially dodgy about your client, just politely sticking to a firm policy can save you considerable trouble.

With known agencies, I extend 30 days credit unless they have a history of slow payment. Then I shorten the payment time (payment in advance as a last resort). With some slow payers, they can overnight a check to me and that is sufficient for me to start a job because I trust their checks but just don't trust their payment timeline.

Sometimes I'll take a chance with an obviously real agency or translator and extend them credit- no problems so far. Sometimes no bad reports is a good sign for a small agency. You have to pay attention to how they approach you, how they describe the job, etc. Be careful, but don't assume everyone is a scammer or non-payer.

For a large job, it's reasonable to discuss installments and interim payments. Book assignments typically do have a large advance payment, but many of our jobs really are book length.


 


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