For many professional snow and ice contractors across the United States and Canada, this winter has been a welcomed relief to an otherwise sluggish economy.

On the other hand, this season has been a continuous test of endurance to manage challenging snow and ice events. Unfortunately, a downside to an active winter is slower or missed payments as the season draws to a close.

Most of us remember times when a supplier called to check on a past-due balance. Were they persistent about the bill getting paid? Snow removal should be no different. A contractor’s service is just as valuable because they’re the reason commercial and retail customers are able to open their doors when a snow event has taken place.

Don’t simply hope for the best when it comes to delinquent clients. Too many times contractors lack the confidence to pursue an outstanding bill because they don’t know what options are available to them. There’s no problem selling the job or completing the work, but when it’s time to collect contractors often are intimidated to pursue the money owed to them.

So here are two things you can do to protect yourself when it comes to getting paid.

Use the agreement

The most important thing is utilizing a service agreement that is finalized in writing and signed before the first snowflake falls.

Obviously, there will still be cases when customers pay slowly. However, having the right terminology in your contract to collect late fees, collection fees and/or attorney fees should never be left out. This will help you get paid faster and, if other collection methods are required, it will give you the right to add those fees.

You may consider adding a clause to your service agreement that allows you to stop service if the customer is not paying invoices within the specified terms. Be sure to check with your attorney for correct terminology and to check for legality in your state. This simple clause can save you labor, material and the headache of wondering if you will get paid for the service you are providing, not to mention countless hours of trying to get your money at the end of the season. This can be added to an already successful service agreement to help protect you from hours of work that you may not be compensated for.

Invoice immediately

Sending invoices immediately after the event is completed is the second action that protects you from slow payment or lack of payment.

Putting the invoice in the customer’s hands within a day or two of the event means they do not forget the “details.” For example, seeing you there multiple times, shoveling the walks, plowing the lot, putting down ice melter and the challenging weather conditions. This helps eliminate the phone calls later saying, “I only remember seeing you here one time.”

Regardless of whether you’re using a per-push, hourly or per-event billing method, getting the invoice out to clients quickly is an important step to helping you receive prompt payment.

Still no payment?

So, you have a signed contract, sent the invoice out promptly and it has been 45 days and no payment has been received. What action do you take?

If you’re in the middle of the snow season should you enforce your “stop-service” clause? Many times starting with a professional phone call, email or letter will get the process started. Find out why the invoices are not getting paid and then you can decide what action to take.

But if the customer is not returning your calls emails or letters then you have two options. First, go see them in person. This allows you to talk to them one-on-one and find out why the invoices have not been paid. You may be surprised how effective a short, simple visit can be to rectifying a non-payment situation. It is generally much harder for someone to deny you payment in person than over the phone. Plus, the element of surprise can be a solid collection tool.

In some cases, it may be hard to get to the individual you need in person. Set aside a half day in the event you spend time waiting for the individual you need to speak to about getting your outstanding invoices paid.

Another option is to turn the account over to a professional collection agency. While a customer may delay paying the “snow plow guy” they will pay sooner when they realize this is a serious matter.

The longer you wait to try to collect this debt the less chance you have of seeing any money. This is why it is always important to start this process as soon as you notice a change in the timing of payments. Remember, don’t fear losing an account because you’ve been forced to call and inquire about receiving payment for services rendered. 

Kyle Volz is a partner at Wayne’s Lawn Service and Profits Unlimited, based in Louisville, Ky.

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