Recently landed a big project, but cash flow’s tight. Wondering if offering a small discount for early payments is worth it. Might help with immediate expenses, but could eat into profits. Anyone tried this before?
Curious about the pros and cons, especially long-term effects on client relationships.
I’ve been on both sides of this. Offering discounts can help, but it’s not always smooth sailing.
Here’s what I’ve learned:
Instead of discounts, I now ask for a deposit before starting work. It’s usually 30-50% of the total. This helps with cash flow and shows the client is serious.
For bigger projects, I break it into milestones. The client pays as we hit each one. This keeps money coming in steadily.
Most important: be super clear about payment terms before you start. Put it in writing and follow up quickly on late payments.
These methods have worked better for me than discounts. They’re less complicated, and I don’t have to worry about cutting into my profits.
I’ve never offered discounts for early payments. It’s simpler to just stick to your agreed terms.
Instead, consider asking for a deposit upfront. It helps with cash flow and shows the client is serious.
For big projects, breaking payments into milestones works well too. You get paid as you go, which keeps things flowing.
Just make sure your payment terms are crystal clear from the start. And don’t be shy about following up on late payments.
Early payment discounts can work, but they’re not for everyone. I’d rather keep it simple and just remind clients when payments are due. Less hassle that way.
I’ve tried early payment discounts before. They can help with cash flow, but there are some things to watch out for.
For one big client, I offered 2% off if they paid within 10 days. It worked well for a while - got money faster and they liked the savings.
But then it became expected. When I tried to go back to normal terms, they weren’t happy. Made things awkward.
Also, it messed with my pricing a bit. I had to adjust to make sure I wasn’t losing money.
If you do it, maybe frame it as a limited-time thing. And be clear about the terms. It can work, but think hard about whether it fits your business long-term.
Early payment discounts can work, but there’s a catch. They eat into your profits and can set bad expectations. I’ve seen guys struggle to get back to normal terms once clients get used to discounts.
Instead, try tightening up your payment terms. Make it clear upfront when you expect payment. Send invoices promptly and follow up firmly if they’re late. Most clients will pay on time if you’re consistent.
If cash flow’s really tight, consider a line of credit from your bank. It’ll cost less than giving discounts and won’t mess up your client relationships. Just make sure you can cover the interest.
Never tried discounts. I just do the job get paid.
Sometimes I ask for half upfront for big stuff.