Been thinking about this lately after another client paid me three weeks late. Started wondering if offering a small discount for paying within terms might actually work better than chasing people down.
Anyone actually tried this approach? Feels like it could either solve the problem or just cut into margins for no real benefit.
We tried this - 2% off for payments within 10 days. Tracked everything for six months.
Mixed results. About 15% more on-time payments, but we lost way more money than the late payment hassles cost us. The chronically late clients stayed late anyway.
Worst part? Existing clients started expecting the discount on old contracts too. Made our regular rates suddenly feel expensive to people who’d been paying them for months.
Dropped it and switched to automatic late fees instead. Way cleaner and doesn’t screw with your pricing.
Stop payments before they’re a problem. I get paid when the job’s done - that day or next morning. No invoices, no chasing people down, no discounts. Work’s finished? You pay. Been doing this for years and it works perfectly. Only time I break this rule is on big projects where I take payments as we go.
I just ask for half upfront now.
Payment terms beat discounts every time. I moved from 30-day to 10-day terms, and most clients actually pay on time now.
Clients who miss payments have cash flow issues. A 2% discount won’t solve that, but shorter terms let you spot problem clients fast.
Cash only jobs when I can manage it.
Different approach. I skip discounts and hit them with late fees after 30 days. Put it in the contract from the start. Way more effective than throwing away money upfront. Clients pay on time when being late costs extra. The stragglers at least cover my headache with their fee.
The incentive thing sounds backwards to me. You’re paying clients to do what they should already be doing.
I’ve had better luck with:
Most late payments happen because people forget or get swamped. Discounts won’t fix that. A simple system that keeps it on their radar beats losing money on every invoice.
Late payments just happen sometimes. I keep my jobs simple and move on to the next one.
The reward approach never made sense to me either. You’re basically teaching clients that your regular rate is negotiable.
I’ve had way better luck being upfront about consequences. I spell it out in every contract:
Most clients pay because they want their project moving. The ones who don’t usually have bigger issues than a discount would solve.
Offering discounts for paying on time just signals you’ve got fat margins. That’s not what you want clients thinking.
Tried the discount thing once. It didn’t make a difference. Payments still late. Just made my margins tighter.