Payment plans: how to make installments work for you and your clients

When your service fees run in the thousands, one thing that can help your prospects say “yes” is to allow them to make payments. Sometimes business owners find this problematic. There can be confusion because when clients don’t meet deadlines or put off decisions, they feel they can’t collect the payment as originally agreed. My students ask how they can collect the balance of payments when they haven’t finished providing the services. For example, if your client hasn’t made the decisions needed to complete a website, you can’t move on to the next section or complete the project. This is where the confusion often shows up. Look at it this way though: the payment plan timing needs to be separated from the service provided. When I offered nutrition counseling years ago, the program lasted for six months. People gave me six $200 checks at the start of the program. Five of these checks were post dated for the future and my clients understood that those checks would go through even if we didn’t have sessions that month. (This, of course, was before I had a merchant account or accepted credit cards.) Offering to accept payments is a courtesy to help clients pay for your services more easily. But it’s not dependent on when they make decisions or have their sessions. The installments are just a payment plan to make it easier to engage your service. So, if a client drags her feet about decision making or cancels sessions, none of these things disrupt the payments. Installments move forward as agreed. Here’s how you can talk about this to get clients and make the process clear from the beginning: “The fee for my program is $3,000. If you chose to do installments, we’ll be happy to set that up over the next (number of months). These payments are a convenience for you to make the fee more affordable and allow you to take advantage of the service provided. However, the commitment is the same whether or not you pay all at once or over several months.” Discussing this upfront with your clients will solve a lot of problems. They’ll know that using your services is up to them. You will not have to worry about getting paid when a client decides they need more time, wants to take a break or is too busy to focus. Those situations no longer impact your fee collection. Your Assignment: If you have clients who are behind in payments, now is the time to address the problem. Explain how they have agreed to purchase your service and payments are due on schedule. Installments are actually a convenience and are not optional. This will help you get clients to follow through on agreements and probably help move projects forward as well.