Forum Moderators: LifeinAsia
A friend asked me to develop a website for his sister who is a realtor. I developed a proposal and she signed it. I developed the site which works perfectly and includes everything in the proposal. She has been using the site for 4 months now.
She said that times were tough and asked if I could hold off on the invoicing for a couple of months to let her get a couple of sales under her belt. I agreed as a favour to my friend and have not sent a single invoice yet.
Now she wants to scrap everything I have done, not pay me, and use the "free" website that her parent real estate company is offering to her and all other agents.
This is the first time I've been "screwed over".
How do I respond to this?
Do I just throw her into collections? That will leave me and my friend in a bitter situation (I can see that conversation already).
Perhaps I can take the high road on this one and be forgiving, respond in a empathetic tone towards her financial hardships and take it as an expensive lesson learned.
Lessons learned:
1. Some form % of payment is now required up front.
2. I done doing favours for people. There are no friends in business.
3. If the client tells you they "can't afford it" - don't do it.
[edited by: tedster at 6:18 pm (utc) on Jan. 21, 2008]
The only thing which is stopping you right now to send the invoice is that you are affraid of loosing the relationship with your friend. Skip that, your relationship is already damaged by this affair no matter if she will pay or not. Actually the best way to keep the relationship is send her the bill and get her pay it.
If she pays (and you might be surprised, but IMHO there is a good chance she will do because of possible legal consequences if she doesn't) the problem is solved and your friendship can continue further. If she doesn't your friendship will probably be lost (which may have been the case already) but you won't blame yourself for the problem but them, which is psycholgically a great benefit to step in future projects.
You missed #4 - Get a lawyer.
If you are in business, then be business like.
Apologise for your friend for his pain, but explain that you have to make a living. You may fear losing a friend - but if you let people treat you like that, there's no respect - and therefore no friendship.
And if he's a friend, he'll understand.
I would first send another invoice to her.
If she still does not pay I would then send an invoice and letter explaining the situation (leaving out the friend part) to her broker. The broker is ultimately responsible for the actions of the agent. Many times to avoid legal action and potential bad press the broker will pay the bill and deduct it from the agent's commissions.
In the unlikely event that you don't get a response from the broker, I would submit the information to the local association of Realtors (assuming that the agent and broker are members). The association requires that all of its members stay current with their financial obligations and will encourage the agent and broker to handle the matter.
good luck
first thing, send the invoice.
then see what happens.
if nothing, then personally i'd explain to the friend and see if he/she can sort it out, it's always best to be amicable and use the leverage of the brother.
after that consider your legal options but only as a last resort
in her mind i suspect she thought this would in some way enable her to not pay legally.
and therefore no friendship. And if he's a friend, he'll understand.
I agree with everyone else that you should go for money. I don't think it is the "high road" to simply walk away. You had an agreement, she signed it, you did the work, she used it. If there is any high road here it is her paying you for all the work you did without trying to weasel out of it. If there is more high road here it is your friend acting like a friend and standing up for you in this situation.
I would approach your friend, show him the agreement and explain the situation, don't suggest anything simply explain the situation and see what he says about the situation. You might be surprised, he may tell you to invoice her.
If he suggests something you don't like then you can always say that your plan was to invoice and explain why. If he is angered and doesn't stand behind you on this, than in my opinion he wasn't much of a friend. From what you have stated here this appears to be a clean open and shut case here without much room for debate and your friend should see that if they are indeed a true friend.
Please let me know what I can do to compensate you for the work already done.
To me, the term 'compensating you for the work already done' at least indicates she is intending to pay you equitably for what you've completed; there appears to be some disagreement between you both about whether it is a finished job or not.
All business have bills, and sometimes it can be hard to meet them. If cash-flow is low, then decisions about which bills get paid necessarily get governed by the consequences of not paying them and the cost of not paying them.
If you are not going to turn the account over to collections and the client has another website so has no need of yours then there are no consequences of not paying. You've already granted her a few months of interest free credit, so there's been no cost of not paying.
My suggestion is that you invoice her today without further delay, that your invoice contains clear terms (e.g. net 30) and that you clearly lay out (as part of the invoice) the consequences of not paying it. Consequences should initially include interest, then debt recovery costs and eventual money claim action through the county court.
Only once you have an unpaid invoice are you able to take this further. Once the debt is a month overdue, send an invoice including interest and debt recovery costs (if permitted and applicable, refer to local law). Include on that invoice that the account is overdue and failure to pay will result in county court action (refer to local law).
Do make sure you have covered your own side. Make sure you are properly registered to do business and are paying the right taxes etc. Anyone who's in a weak position won't be able to push very hard.
she did mention in the beginning that there was a possibility [parent real estate company] would be providing free websites...
i told her the system i would build her would come complete with a listings management system that is integrated with google maps... a featue that the free sites wouldn't have... she liked that and signed the contract...
i'm not in business to make friends... i have scruples and am completely ethical in all areas of practice... but this woman is actually trying to screw me over...
well time to fight (in a professional matter)...
i'll update this post with the outcome. stay tuned.
In this case I'd let it go but in the future get full payment upfront, at the very least 50-50 if you think you can trust the client.
We rarely do 50-50 as many clients will drag out the project or make you do a million little "fixes" so the project is never done and they never have to send the 2nd payment.
New Realtor in this market. Should have been your first clue.
1. Pre-qualify customer's ability to pay.
That may involve doing a credit check, getting a D&B or similar report on a private company, checking SEC documents on a public company, or simple logical reasoning.
Why on earth didn't you ask yourself: "New Realtor. Down market. Hmmmmmmmmmm....."
I know a lot of experienced Realtors who are crying right now.
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Ask your accountant what he would consider reasonable collection efforts, then do what he suggests. If you do not make reasonable collection efforts, you will not be able to write-off the loss.
She is unlikely to pay. If you doubt me, watch tomorrow's stock market, and pay attention to where the blame is placed. She bought-into the same mania that propelled property prices beyond reason. (I can be kind and say she was a victim of bad timing.) Now, you and she suffer, but it's great example of how the housing crisis is moving out through the economy in waves.
Sorry to ramble on. My point: be aware of general business conditions and adapt to them. You cannot focus just on your little niche. You must be aware of the world around you. My #1 reading recommendation for webmasters (or anybody in any kind of business) is The Economist. It's not at all as dry as it sounds - in fact, it's a fascinating read - my friends can't put it down when they come over. I kid you not! (You should have read their obituary for Ike Turner...)
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I think, also, a part of professionalism is considering whether taking on a job is in the best interest of the client. Knowing that she was going to work for (I gather) a large real-estate chain, I would never have done the job. They provide excellent online resources for their agents. I would only consider doing a custom site for an agent with a great deal of experience who has specific needs that won't fit into the company's offering.
A better proposal would have been to help her to better use the company's site. (In the case of an independent agent, I'd offer to help them choose a third-party service.)
It's a highly competitive field, and neither a new agent nor a web designer without prior experience in the field have any business building a one-off site. IMO, of course.
You might want to take that into consideration in making your final decision.
IMO - to quote Richard Nixon - mistakes were made.
[edited by: jtara at 4:32 am (utc) on Jan. 22, 2008]
Bingo! The site was already in use. An invoice is due and payable immediately.
Onya
Woz
you will not be able to write-off the loss.
Also, take the friend issue out of the equation- business is business. If you want to jeapordize your friendship, you can ask him to get involved in trying to get the sister to pay. If you want to keep the friendship, don't bring up the subject. Most likely, he already feels bad enough that he subjected his friend to his scheming sister. (And if he does NOT, then how much do you really value that friendship anyway?)
Your client signed the proposal, took delivery of the finished project, and used it. Invoice is due (and should have been sent at project completion). Period. Out of niceness and trying to help out a client, you allowed the client to postpone payment. However, the original bill is still due.
I would suggest another invoice with an added warning that unpaid balances after a certain date (e.g., 15 or 30 days after the invoice date) will accrue late fees and interest (what interest you can charge may be subject to local usery laws).
[edited by: LifeinAsia at 4:58 pm (utc) on Jan. 22, 2008]
Since the OP is most likely on a cash basis, there is no "loss" to write off. Cash basis businesses only count revenue when they receive it.
In that case, yes, there's nothing to write off, since the income was never booked. There is no obligation to make a reasonable collection effort.
Also, take the friend issue out of the equation
It's too late to take the friend issue out of the equation. That should have been thought of sooner. It's now part of the equation.
business is business. If you want to jeapordize your friendship, you can ask him to get involved in trying to get the sister to pay. If you want to keep the friendship, don't bring up the subject. Most likely, he already feels bad enough that he subjected his friend to his scheming sister.
I am tired of hearing "business is business" cited in this forum. Those who do so are losing sight of the title of this forum:
Professional Webmaster Business Issues
Professional - at least to me - implies more than "full time" or ">$n income".
It implies conducting yourself in a professional manner.
As described here, neither party conducted themselves in a professional manner, and both share the blame.
The web designer was unprofessional to do business with the relative of a friend. The Realtor was initially naive', agreeing to have a one-off design made for her - something that is almost never done given the availability of resources provided free by major Real Estate companies (and well-proven third-party services available for those not working for major companies.) Even so, she was aware that a free site "might" be made available to her. Yet, she went ahead with this ill-conceived plan, and the designer went along with it, when the professional thing to do would have been to advise her against it.
I'd suggest trying to work-out a compromise, move on, and try not to make the same mistakes again.
The web designer was unprofessional to do business with the relative of a friend.
If you had a B&M business, would you refuse to serve your friends or relatives in the name of being "professional"? For many people, especially small businesses in their startup periods, the bulk of their business comes from leads provides by friends and relatives.
You cant change the past but you will have to accept some of the impact of the mistake that was made.
Unless you want to spend the time and money to resolve this legally, you will likely eat that project.
I also sounds as if your placing too much weight on your responsibility in this friendship. Seems your friend would be more concerned with a resolution since the project was brought to you by him.
Your response should be to let the client know your seeking pay for your work and let your friend know his referral stiffed you. If you dont get a response and you feel its worth the cost and effort, pursue legal action.
Above is assuming the amount is claimable under US version of small claims / county court.
IMO the only thing unprofessional or niave on your part was not sending the invoice on completion.
The web designer was unprofessional to do business with the relative of a friend.
I have done business with friends before and it has worked out fine. I was very clear upfront and had a signed agreement. I don't think it is unprofessional to do business with a friend or friend of a friend as long as you treat it like any other business transaction and are clear upfront with everything. Even friends need web sites.
The web designer was unprofessional to do business with the relative of a friend.
Nothing unprofessional about it, provided both were clear that it was a professional relationship, not a 'favour' - and the 'introducer' was aware of that too.
And nothing the OP has said suggests there was any misunderstanding, or other unprofessional issue with the relationship.
It does sound a little as if better advice might have been 'don't sign with me - see what the parent site is offering first' - but I don't think we have enough info to really judge that.
And any problem there would be regardless of the 'friendship' angle - which is unproblematic ... except the OP believes she is using it to avoid payment!
[edited by: Quadrille at 12:47 am (utc) on Jan. 23, 2008]
In this case I'd let it go but in the future get full payment upfront, at the very least 50-50 if you think you can trust the client.We rarely do 50-50 as many clients will drag out the project or make you do a million little "fixes" so the project is never done and they never have to send the 2nd payment.
Really? Are you typically able demand full payment upfront?
hey my sister is in the real estate market and wants a site sticky me the url. never know some minor fixin and you might just have a sale
hey my sister is in the real estate market and wants a site sticky me the url.
Do we all appreciate the irony? ;)
hahaha...
A couple lessons that definitely need to be pointed out here is:
1.- Never do business with friends/family unless a SERIOUS discussion takes place before hand stating that business is business and friendship is friendship.
2.- Always ask for money up front. Get something for your investment of time. If the client needs "time" to come up with the money just promise that the offer will still be available when the client- friend or not- has the money in hand, and once that occurs that you can start on the site.
You would not think this but with friends and family sometimes you need to be even more anal than you are with a normal client explaining things and following through with procedures.
They always think that they are going to get the best since a friend is doing there work...but they sure dont show the same respect in return.
Good luck in whatever decision you end up making!
Even though the work she did really wasn't useable I let her fulfill the contract and paid her the full amount anyway. I felt the family friendships were worth much more to me at the time than the money.
I don't see it. Seems like just another referral to me.
The reverse seems unprofessional to me. I can't imagine how I would react if I tried to refer a sister to a friend's business and they said no.
Give her a deadline and then hire an attorney if she hasn't paid.
What a terrible sister.
The realtors new website has her new email address on it but it bounced back at me.
The invoice says payable on reciept.
Will give it 2 more weeks and send a second notice. Then final notice. If nothing I'll send her to collections.
Will update any progress as it happens.
Will give it 2 more weeks and send a second notice. Then final notice. If nothing I'll send her to collections.
I don't believe it is necessary to involve your friend, her brother, but I am curious if you have had any conversations with him or if you plan to about this issue?
