Client won't pay?

[geoff-h -at- MTL -dot- FERIC -dot- CA]

 (Sorry, lost the beginning of this thread... client claims
 he can't pay.)

 A few possibilities. I've read (Financial Post magazine? in
 a Canadian context) that if the client is in danger of
 bankruptcy, you should file your claim (don't recall with
 who... probably the bank) early in the process, before
 everyone else, and this may get you some of your money.
 You're not ahead of the preferred creditors, but at least
 you're at the top of the list for the rest of the
 creditors. I don't know how this works in the U.S., but
 hopefully a listmember can provide details. An alternative
 is to take them to Small Claims Court if the sum is low
 enough, but that's going to cost you time and perhaps
 money. You simultaneously set a good and a bad precedent
 this way: you let it be known that nobody messes with you.

 The second possibility is that the client really does have
 his heart in the right place, but simply has no money. It
 may not even be his fault, particularly if he isn't senior
 management. In some cases, bartering may recoup part of
 your investment. For example, they may give you a (legal)
 spare copy of some software, a dozen copies of their
 product (that you can then resell), free use of their
 office copiers/printers/etc., or something else equally
 helpful. Worth a try. If nothing else, get a sterling
 letter of reference before you walk away.

 The final possibility is that their cash flow simply
 doesn't permit a lump-sum payment, but may permit a series
 of smaller payments (with or without interest). Propose
 this! A conscientious client in a bad position might be
 able to pay (slowly) out of petty cash what they couldn't
 pay by requesting a large cheque from the accounting
 department. (I've done this several times with clients who
 were solvent, but who didn't want me to wait forever for my
 invoice to clear their purchasing department or to be
 signed by a manager who was away on vacation.)

 --Geoff Hart     @8^{)}     geoff-h -at- mtl -dot- feric -dot- ca
 Disclaimer: Speaking for myself, not FERIC.