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Long time client struggling with debt - what should I do?
Thread poster: Tom in London

Tom in London
United Kingdom
Local time: 02:04
Member (2008)
Italian to English
Nov 9

A much-loved agency with which I have worked for many years has run into financial difficulties and is not able to pay several of my invoices (for quite small amounts) totalling about € 1500.

I have no intention of acting harshly with this agency. Over the years they have been very supportive and we have a friendly, trustworthy relationship. I have had a lot of work from them.

They have been open and honest to me about their current situation. They say they intend to
... See more
A much-loved agency with which I have worked for many years has run into financial difficulties and is not able to pay several of my invoices (for quite small amounts) totalling about € 1500.

I have no intention of acting harshly with this agency. Over the years they have been very supportive and we have a friendly, trustworthy relationship. I have had a lot of work from them.

They have been open and honest to me about their current situation. They say they intend to get through it and pay all their bills.

If you had a client like this, what would you do?
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Thomas T. Frost  Identity Verified
Member (2014)
Danish to English
+ ...
Instalments? Nov 9

Could they pay in instalments? Is there any monthly amount they could afford to pay?

Since you're on good terms with them, you could try to find out what they are doing to stabilise their cash flow.

Apart from that, it would be wise to keep an eye on public insolvency records for this company. If they do go bust, you have to react quickly – even though you're unlikely to get anything.

Needless to say, it would be unwise to work for them again until they h
... See more
Could they pay in instalments? Is there any monthly amount they could afford to pay?

Since you're on good terms with them, you could try to find out what they are doing to stabilise their cash flow.

Apart from that, it would be wise to keep an eye on public insolvency records for this company. If they do go bust, you have to react quickly – even though you're unlikely to get anything.

Needless to say, it would be unwise to work for them again until they have paid what they owe you.
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DZiW
Josephine Cassar
Sheila Wilson
 

Tom in London
United Kingdom
Local time: 02:04
Member (2008)
Italian to English
TOPIC STARTER
Instalments Nov 9

Thomas T. Frost wrote:

Could they pay in instalments? Is there any monthly amount they could afford to pay?


They did manage to pay me half of the first invoice. I still await payment of the others.

Since you're on good terms with them, you could try to find out what they are doing to stabilise their cash flow.


Good idea. I may do that.

Apart from that, it would be wise to keep an eye on public insolvency records for this company. If they do go bust, you have to react quickly – even though you're unlikely to get anything.


Alas, Thomas, my client is in Italy and I can't find any way to access the Italian public insolvency records without having to pay an agent. But in response to your suggestion I've asked about this in the Italian forums.

[Edited at 2019-11-09 17:57 GMT]


 

Thomas T. Frost  Identity Verified
Member (2014)
Danish to English
+ ...
Here? Nov 9

Have you tried if this search facility works?

https://e-justice.europa.eu/content_interconnected_insolvency_registers_search-246-en.do

Italy is included, but only some provinces: 'Due to national regulations the service currently provides information on insolvency procedures registered in the provinces of Genoa, Grosseto, L
... See more
Have you tried if this search facility works?

https://e-justice.europa.eu/content_interconnected_insolvency_registers_search-246-en.do

Italy is included, but only some provinces: 'Due to national regulations the service currently provides information on insolvency procedures registered in the provinces of Genoa, Grosseto, Livorno (Leghorn), Rovigo and Venice.'

This being about Italy, you could try posting them an English delicacy of symbolic value up to Christmas (perhaps not Marmite) and express in some flowery prose how sorry you are on their behalf and that you understand how difficult this must be for them and their families, particularly in the Christmas season, wishing them all the best. The idea is obviously to inspire them to keep your invoices in mind and perhaps favour them over other unpaid bills.

I wouldn't recommend this method in Germany. They'd probably report you to the police for bribery.
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Dan Lucas
Tina Vonhof
 

Tom in London
United Kingdom
Local time: 02:04
Member (2008)
Italian to English
TOPIC STARTER
thanks but... Nov 9

Thomas T. Frost wrote:

Have you tried if this search facility works?

https://e-justice.europa.eu/content_interconnected_insolvency_registers_search-246-en.do

Italy is included, but only some provinces: 'Due to national regulations the service currently provides information on insolvency procedures registered in the provinces of Genoa, Grosseto, Livorno (Leghorn), Rovigo and Venice.'


Thanks but this particular agency is in the province of Rome - no doubt due to these "national regulations".

This being about Italy, you could try posting them an English delicacy of symbolic value up to Christmas (perhaps not Marmite) and express in some flowery prose how sorry you are on their behalf and that you understand how difficult this must be for them and their families, particularly in the Christmas season, wishing them all the best. The idea is obviously to inspire them to keep your invoices in mind and perhaps favour them over other unpaid bills.


Now THAT is a good idea. Maybe I'll look for a bottle of the Scotch whisky that bears the same surname as me, and send it to them!


Jane F
 

DZiW
Ukraine
English to Russian
+ ...
Barter ? Nov 9

Tom, not exactly your case, but once after a project a friend of mine owed me about the same amount, but offered two new notebook and a colour laser printer, which was a really good deal.

 

Kuochoe Nikoi-Kotei  Identity Verified
Ghana
Local time: 02:04
Japanese to English
Best approach Nov 9

Thomas T. Frost wrote:
Could they pay in instalments? Is there any monthly amount they could afford to pay?


Since you asked "If you had a client like this, what would you do?" I would say Thomas's approach is the best one. It's a client you've had a good relationship with, and one you would like to keep working with once they solve their issues. You don't want to be the guy that kicks them when they're down.

In fact, if the total amount had been small, I would have counseled writing it off altogther for old times' sake. Unfortunately 1500 EUR is too much to ignore, so I would reach out to them (before or after Operation Scotch Whisky, it's up to you) to draw up a payment plan that claws back as much money as possible without overburdening them. Surely they can afford 150 a month. 100? Even 50? 0 is not an option, but anything above that can be negotiated.

[Edited at 2019-11-09 19:45 GMT]


Nikki Scott-Despaigne
Tina Vonhof
Josephine Cassar
Sheila Wilson
ahartje
Sabrina Bruna
Barbara Micheletto
 

Tom in London
United Kingdom
Local time: 02:04
Member (2008)
Italian to English
TOPIC STARTER
Ideas Nov 9

Kuochoe Nikoi-Kotei wrote:

Thomas T. Frost wrote:
Could they pay in instalments? Is there any monthly amount they could afford to pay?


Since you asked "If you had a client like this, what would you do?" I would say Thomas's approach is the best one. It's a client you've had a good relationship with, and one you would like to keep working with once they solve their issues. You don't want to be the guy that kicks them when they're down.

In fact, if the total amount had been small, I would have counseled writing it off altogther for old times' sake. Unfortunately 1500 EUR is too much to ignore, so I would reach out to them (before or after Operation Scotch Whisky, it's up to you) to draw up a payment plan that claws back as much money as possible without overburdening them. Surely they can afford 150 a month. 100? Even 50? 0 is not an option, but anything above that can be negotiated.

[Edited at 2019-11-09 19:45 GMT]


Another good idea ! Thanks Kuochoe


Kuochoe Nikoi-Kotei
 

Teresa Borges
Portugal
Local time: 02:04
Member (2007)
English to Portuguese
+ ...
Occasionally, patience pays off… Nov 9

Five years ago I found myself in a similar situation with a Belgian agency I had been working for over 20 years. I had a lot of work from them and they were always quite honest, sometimes they paid more or less promptly, others very late but they always paid and I always waited patiently. As far as I know I was one of the very few translators who were paid entirely when they finally went bust.

mariant
 

Tom in London
United Kingdom
Local time: 02:04
Member (2008)
Italian to English
TOPIC STARTER
and.... Nov 9

Teresa Borges wrote:

Five years ago I found myself in a similar situation with a Belgian agency I had been working for over 20 years. I had a lot of work from them and they were always quite honest, sometimes they paid more or less promptly, others very late but they always paid and I always waited patiently. As far as I know I was one of the very few translators who were paid entirely when they finally went bust.


...and, Teresa: while you were waiting patiently to be paid, did they ask you to do any more translations for them?


 

Teresa Borges
Portugal
Local time: 02:04
Member (2007)
English to Portuguese
+ ...
@Tom Nov 9

Yes, they did and I accepted, though I must say that work from them had become in the meanwhile very few and far between. Good luck, anyway!

 

Sheila Wilson  Identity Verified
Spain
Local time: 02:04
Member (2007)
English
+ ...
How much are you prepared to lose? Nov 10

You say you aren't prepared to stop work, demand payment in full, and refuse all further work from them? That would be the "sensible business decision". If that's out of the question (and I can understand why you feel it is), it really stops being a business problem and becomes a personal one. As it seems likely that sooner or later they'll file for bankruptcy, you'll need to decide for yourself how much the relationship is worth. Like lending money to a friend, it's risky, especially when ther... See more
You say you aren't prepared to stop work, demand payment in full, and refuse all further work from them? That would be the "sensible business decision". If that's out of the question (and I can understand why you feel it is), it really stops being a business problem and becomes a personal one. As it seems likely that sooner or later they'll file for bankruptcy, you'll need to decide for yourself how much the relationship is worth. Like lending money to a friend, it's risky, especially when there's a history.

I haven't been in similar circumstances, but it seems to me that arranging regular monthly -- or even weekly -- payments by direct debit, standing order or similar method would be a good halfway measure that would enable you to take on further work with a little less risk. I'd be doubtful about leaving it up to them to initiate the payment each month though, as that could well lead to constant reminders and hence bad feeling.
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Barbara Micheletto
 

Tom in London
United Kingdom
Local time: 02:04
Member (2008)
Italian to English
TOPIC STARTER
Yes Nov 10

Sheila Wilson wrote:

.... it seems to me that arranging regular monthly -- or even weekly -- payments by direct debit, standing order or similar method would be a good halfway measure that would enable you to take on further work with a little less risk. I'd be doubtful about leaving it up to them to initiate the payment each month though, as that could well lead to constant reminders and hence bad feeling.


Yes- someone else said much the same thing. I'm considering it. It makes sense. Thanks.


 

Samuel Murray  Identity Verified
Netherlands
Local time: 03:04
Member (2006)
English to Afrikaans
+ ...
@Tom Nov 10

Tom in London wrote:
A much-loved agency with which I have worked for many years has run into financial difficulties and is not able to pay several of my invoices (for quite small amounts) totalling about €1500.


I'm not sure about Italian law, but in my country of birth, if a company gets into financial difficulties, they are required to treat all creditors equally, lest some creditors who feel that they did not get preferential treatment sue the owners or directors (which they could, even after the owners or directors have completed all their obligations in terms of the bankruptcy procedures).

It may be that this agency's lawyer instructed them to send you this e-mail in the hope that you will respond in some way that basically means (even if you don't actually say it) that you are unlikely to sue them if they pay their larger creditors first. This might mean that if they do go bankrupt, you won't see any of your money back.

On the other hand, even if you play hardball, and they are on the brink of bankruptcy, you might not see you money back anyway.

If you had a client like this, what would you do?


As a small creditor, I would be as reasonable as I can be. If they don't make it, I lose my money. If they do make it, I get some of my money *and* I get back a good client. Instead of asking for payment in installments, I would suggest a deferred payment (say, 6-12 months).



[Edited at 2019-11-10 10:53 GMT]


 

Nikki Scott-Despaigne  Identity Verified
Local time: 03:04
French to English
My experience Nov 10

Tom in London wrote:

...and, Teresa: while you were waiting patiently to be paid, did they ask you to do any more translations for them?


When one of my clients ran into cashflow problems, certain employees continued to send me work. I refused until some of the outstanding invoices were paid. At this point the big boss called me, screamed at me down the phone for not continuing to support them as they had given me a lot of work. I replied that they had not given me a lot of money recently and that they would have to go elsewhere at least until the larger invoices were paid in full, or unless they could pay the outstanding amount in 10 monthly instalments. He screamed again. I sent a formal demand, got what was owed and never heard from them again. It was just as well.

While I'm prepared to understand the tension he felt when cashflow had become a problem, his late payments were not making my situation easier either, as if his problems continued, I was looking at the possibility of never recovering what was due. I was not about to dig the hole any deeper, certainly not for someone who screamed at me for not "supporting" them. I already was, more than I could afford, in not having hassled them until then. My mistake. This was one of the clients I learnt from. Never let a client run up that much credit. You are not a bank. The solution, however, has to be on a case-by-case basis. Self-protection has to be foremost.

Clients sometimes run into difficulty through no fault of their own, but it's bad news when their no-fault leaves you with unpaid invoices. Bear in mind that if your client recovers, then you may have to be more careful and not leave more than X amount outstanding or not accept jobs of more than X without a downpayment. It's uncomfortable, particularly if you get along with them and they have always been straight until now. Their vulnerability must not lead to yours.

[Edited at 2019-11-10 11:50 GMT]


Sheila Wilson
Josephine Cassar
Philip Lees
Jenn Mercer
Kuochoe Nikoi-Kotei
 
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