… apply the credit note after the reduced amount has been paid.
In one case recently, the debt collection lawyer one of our clients uses when collections go “legal”, noticed that with one particular invoice that she was pursuing, the addendum to the invoice had disclosed “reduced costs”; that is: they had disclosed what the whole job had cost XXX, “but for you, say . . . YYY”. Notwithstanding that, the matter had gone to legal. She passed on this recommendation which is well worth implementing if you ever do that.
“You may wish to suggest to the Partners that if they discount costs, they state that the discount is conditional upon payment being made within a certain period of time (ie: say 7 or 14 days) to firstly encourage prompt payment and also enable the Partners to pursue the whole costs if it is not paid on time (particularly if you have to sue them to recover the costs).”
She raises an extremely valid point from a “collection” perspective as it encourages the client to contact you if they can’t pay strictly within terms which, in turn, allows you to “extend” the discount period – when reasonable – as well as enabling you to pursue the larger (undiscounted) amount if necessary. Let’s you remain the Good Guy.
OK, pay this and we’ll call it quits
This also applies if you decide to accept a reduced amount when someone’s disputed a fee and you decide to accept less to finalise things. Give them the discount AFTER the reduced amount’s been paid.
See also do doiunctss wrok?