Hello
We have a resellr who has gone AWOL.
Owes us money, is not responding to email or phone messages.

Question is:
Do we just kill his 200+ overdue accounts or do we try something else to get him to pay up.

Over to you, resellers.........
The account has been overdue for about a week.
What would you do?

Gordon

I'm not a reseller, but I'll give you my opinion (I'm a big mouth so I'm good at it :D)

I would give it another week... during this time, obviously make attempts to get in touch (and obviously keep a record of this just in case). During this week put together contact details of the 200+ accounts that you host (I'm sure you have these details or can get access to them). Near the end of the week simply send out an e-mail to the customers advising them of the situation, explain that it you would recommend trying to find another host as soon as possible.

I think this is a fair solution... you might lose 2 weeks or so revenue, but it goes some way to proving that your hosting company is not completely cold hearted ;) Also, that's plenty of time for this reseller to get in touch, and it's fair on the people who have accounts with him / her.

Do you know where (s)he lives and what his/her full name is?If so, I'd have to advise you to take legal action... I assume a reseller with 200 accounts brings in quite a bit of revenue...

Nico V.

It really depends on whether you want to take a really tough stance or not... I would still stick by my original idea, but if you want to try and teach this reseller a lesson (and make it clear you tolerate no messing about) then fine, take legal action... only problem with that is, you'd likely incur hefty legal fees. :bawling:

There is no sense in taking legal actions. If it is only a week, give him some time. After all, he is a reseller and is generating a lot of business for you. Maybe they are on vacation??

Either way, one more week wouldn't hurt. Then, you can suspend the resellers accounts. If they are just avoiding your emails, once you suspend the accounts, I would bet that he gets in contact with you pretty darn quick. If not, then you just write it off. If you try and take legal actions, he will just say that he didn't authorize the charges and that will be the end of it.

OK
I will leave it a bit longer

We had problems getting the payment from them last month as well.
The amount of money involved is not significant to our business, but I just don't like the idea of turning people's sites off.

I have other resellers who would jump at the chance to take them on but obviously thats not an option.

Gordon

Completely unreasonable in my view.

You would consider pulling the plug on him (never mind the 3rd parties) because of a week?! A week!!

How do you know his wife/parents aren't hospitalised or something?

On top of that you'd damage 200 other busineses that are not directly responsible and possibly not even aware?

What would you do if for some reason a bank had forgotten to paty a Standing Order and I'd just gone to say Spain for 10 days. You'd return to have your biz knackered by yourt host for that?

Well I wouldn't dream of hosting with you now. No wonder its virtually impossible to find a mature, service-oriented host in the UK.

There is more to running a biz than just banking cheques, Gordon.

Well, as I said, I think a week is a bit too short. If he has had problems before with this reseller, he needs to lay down the rules and adhere to them..

Here is an example for you Dr. Strangelove. We have had servers at Alabanza and have hosted over 1700 sites there. If we missed a payment to them, they shut off access to the servers after a week. They do not care about our customers, only that they did not get their money, and same applies here. Gordon should not be concerned about collecting money from his customers' customers. The fact is, responsibility lies on the reseller.

If the reseller decided to go to Spain for 10 days, he should make sure his bills are paid BEFORE he leaves. And he should not have any business to leave for 10 days without any backup (but that is a different story for another thread).

The real kicker here is that Gordon has had problems with this client before. If it was the first time, then yes, he should be a bit more understanding and give him some time. But, since this is a problem already, how many more chances should he give? If he cuts the sites (suspends until the account is paid) then they will understand that they should not be playing games with THEIR business. After all, they collect the money from their clients. They get paid. Why shouldn't Gordon?

Originally posted by Dr Strangelove
On top of that you'd damage 200 other busineses that are not directly responsible and possibly not even aware?

He didn't say that and he would be silly if he did that. The common way is to overtake the account of the reseller - so there is not even a minute downtime.

If the reseller decided to go to Spain for 10 days, he should make sure his bills are paid BEFORE he leaves. And he should not have any business to leave for 10 days without any backup (but that is a different story for another thread).

...but if he'd he left it in the hands of a bank he WOULD have reasonably expected it to be taken care of.

This whole approach to cutting people off after a week is pathetic it is wholly unprofessional. This macho syle is immature - intemperate.

Apart from that the reseller may have legal redress because of the unreasobleness of such action. The end-client certainly would. This regardless of any terms and conditions.

Originally posted by Dr Strangelove


Apart from that the reseller may have legal redress because of the unreasobleness of such action. The end-client certainly would. This regardless of any terms and conditions.

Not at all. It is not unreasonable to shut a site down if it is not paid up. Basically, the service was not paid for when it was used. There is not a sigle court that would expect any entity to keep an account open if they had suspicians that the account would not be paid.

Remember, there is a track record here and it is not an isolated incident.

Originally posted by Dr Strangelove
This whole approach to cutting people off after a week is pathetic it is wholly unprofessional. This macho syle is immature - intemperate.

Apart from that the reseller may have legal redress because of the unreasobleness of such action. The end-client certainly would. This regardless of any terms and conditions.

What is pathetic are customers who expect service when they ain't paying for it. This isn't unreasonable, this is life.

The apartment complex I live in gives you until the 3rd to pay your rent (due on the 1st). After that, they mail you a 'pay or quit' notice (you are given 3 days to pay up, or you are automatically sent a 30 day notice - look for a new place). I know, because I was a manager here and had to serve these notices. Amazing how quickly people pay up.

Businesses aren't some charity where you choose when you want to pay for what you are using. If you can't pay, then contacting the business and making arrangements works 99% of the time. People are understanding, and you're more likely to get an extension. Without contact, there is little to go on.

Neither the reseller nor the client of the reseller would have *any* legal recourse for the reseller not paying for the service, even if it were cut off. You can be nice and choose to float them, even without contact from the person (really who knows if they ever intend to pay), but it is hardly macho nor pathetic to stop service to someone who isn't paying their bills.

No host wants to do this. No host likes to do this. I didn't enjoy giving people 30 day notices either, but if you allow it to happen, you increase your chances of getting screwed over, for more money.

Well said Chicken.

If they don't pay, they don't play, its that simple. You have given them a week and that is more than reasonable. I wouldn't have gone past 3 days myself.

Businesses aren't some charity where you choose when you want to pay for what you are using.

You are missing the point. The issue I was focusing on is not non-payment, per se, it is if a week is reasonable. It isn't.

As for the law I don't know about the US but in the UK if you could show (in the case of the reseller) you had reasonable expectation of it being paid (by ther bank in the eg) you would have a case. As far as the end-users are concerned just to shut them down without prior warning as was suggested would also be grounds. FACT!

But it is the resellers responsibility to take care of their customers, not the host.

If the host did not pay their bill to the NOC, and the NOC shut them down, should the NOC be concerened about the 1000's of customers the host has, and in turn the tens of thousands of sites they are hosting?

No. They want their money...as promised.

Well, this certainly got a discussion going.

Ultimately we can't provide the service for free, so something will have to give eventually.

Gordon

Well, you may not think a week is reasonable, but it comes down to the agreement that the reseller, errrr... agreed to.

Many people didn't exactly think it was 'fair' to get kicked out of their apartment, just for not paying (remember 6 days after the 1st), but this is what they agreed to on the lease (which we always included with the 3 day notice). Roommates who paid the person leasing the apartment weren't all that thrilled to be booted out either, but such is life.

You can argue it to the death, but the host has one customer, the reseller. If the reseller doesn't pay according to terms, they get cut off. (I don't think 'cutting anyone off' was the exact point of the first post, nor what will happen in this case, but these are just general comments).

You may choose to extend payment terms, regardless of the agreement you make your customers sign, but I can tell you one thing. A week is plenty of time, especially with no contact. If you ever are having trouble coming up with payment, contact your provider and at least let them know about the situation.

Its the not contacting us thats the real problem.

I have someone who hasn't paid this month and replied to the reminder saying she is overseas and can we wait till she gets back.
She's a regular payer and I have no problem waiting.

Its just when people don't reply that the real problems start.
I have left another message on the resellers answering machine to see what happens.
Its been 2 hours and no reply yet............


Gordon

Originally posted by Dr Strangelove
You are missing the point. The issue I was focusing on is not non-payment, per se, it is if a week is reasonable. It isn't.

Just wanted to add that I hope you aren't taking this personally, it isn't meant to be. I realize we have different views on the subject, and I'm not trying to attack you, rather I'm just stating my opinions on the matter, based on my experiences in various areas.

Since you said that a week wasn't reasonable, I was just wondering how long you'd expect? Again, I'm taking about no contact, not if the client contacted you and made arrangements.

[quote]Chicken: Just wanted to add that I hope you aren't taking this personally[/qoute]

No, I'm not taking it personally, not even from my immoderator.. err moderator ;)

Its certainly true I find some of the sentiment expressed here a bit immature. As someone who has worked as CEO in large corp life and now runs a mgt consultancy, I've seen many sectors and markets. With some notable (but very few) exeptions the hosting sector is, well at the wilder and less professional end. Many hosts frankly just shouldn't be in business.

And it is usually axiomatic that if you pitch your business at the low end of the market you get low end behaviour.

The issue as originally posted here was not if service should be provided without payment, bit if termination after a week involving an additional 200 parties was reasonble. It isn't. As I said there may be perfectly good reason why that has happened. There is little extra background about the customer in question.

It is now additionally suggested that not returning a 2 hrs phone msg is some sort of evidence of a felony. This is ridiculous. As if all resellers are waiting by the phone in case their host rings! I have been in Amsterdam for a few days this week - there were messages for me that were over 2 hrs old.

Additionally, the apparently common sense view that an immediate transgression in terms allows a cut off would not neccesairly hold water in the UK. There is also a duty of care (legal term) which basically says you still should be reasonable and proportionate. Unless there is more "history" on this case than shared, the action proposed is neither reasonable nor proportionate.

Anyway, I've said my bit on that now.

In answer to you last question: we give clients 30 days, which is long enough for any unusual diffuculty to be accounted for.

We had a client habitually being late with their invoice recently and simply gave them notice to find another host.

Now get back on yout horse and drink your milk ;)

Actually, I think you misunderstand.
This client did not pay by invoice.
His contract was to pay in advance each month by credit card.
Last month the card failed and he made a one off payment (eventually).
We have attempted to get him to set up a new monthly payment for 3 weeks.
His account is now a week past the payment date again.
We have been unable to contact him by telephone, e-mail or fax.

Under the circumstances we have no choice but to terminate his contract and all of those web sites.
Presumably if he is not answering our calls he is also not providing any customer support either.

The ethical issue is whether we (as the ultimate supplier) could contact the site owners and offer to continue their service under our name, given that we have no relationship with them.

I have compiled a list of their e-mail addresses and may offer them that opportunity before cutting them off.

I don't think anything about this is immature or "wild".
If the customer had phoned up and said "I can't pay for 7 days" none of this would have happened.
Its the zero contact thats the issue.

Gordon

I don't think I do misunderstand, nor did I say I assumed YOUR client had paid by invoice. And you did not explain yourself fully.

I absolutely stand by my comments about the hosting markets.

If you are now saying the issue is contacting the 3rd parties, my approach would be to issue written intent to contact 3rd parties to the reseller at the 30 day point (using the non-payment date as a a starting point). I would suspend his (personal) account, ih he uses one but not his clients.

Only then would I approach them directly. This way you have been fair to the 3rd parties, you may retain business and you can justifiably maintain that the reseller was given ample warning and notice of intent.

If you don't give notice of intent you risk a secondary legal issue.

OK
I have now completed an investigation of the client using electoral registers and Companies house.

The guy turns out to be 17 years old.
His last reluctant payment was made with his mothers credit card.
His phone numbers and codirectors phone numbers listed at Companies house appear not to exist.
Neither are listed in any telephone directory at those addresses (nor is the clients mother).

None of this makes me think its likely he will be forthcoming.
We have all heard of hosting companies like this.

The bottom line is that his contract with us states that we can terminate him if he is more than 3 days overdue.
I just don't want to leave the end users high and dry.

Gordon

I would have to go along with DrStrangelove's last suggestion.
And, when the time came to contact the individual accounts, I would simply explain the situation and that they need to make alternative arrangements. I wouldn't just plug my services. However, I'm sure you could include somehow, that you do provide hosting services for individuals ;)

Hello
I now have information from another creditor that the company has gone down owing them money as well.

I have contacted the 70 or so clients of theirs I could track down and have been helping them to get the domains moved to other hosts etc.

There didn't seem any point in waiting until we got confirmation.
I am afraid it was another teenagers bedroom type company with one of them just old enough to be a company director.

At least some of the sites have been salvaged and people are getting a bit of warning.

Gordon

Actually we just closed an account ourselves for much the same reasons (end client, not a reseller though). After a month of no contact, repeated attempts and three 10 day apart billing attempts we had no choice to shut off the site.

There is a responsibility for the customer to keep their contact details current so they can be kept up to date on what's going on.

Regarding this reseller, I think he's had more than enough time. If he's not available to you, I'm pretty sure he's not available to his customers either. I wonder how many of those accounts even have domains that point to them anymore, or has there been an exodus that you haven't been told about.

I think it's time to reach down past the reseller and contact those end clients about what's happening. That you're the upstream and are stepping in, in their best interests as their 'host' has become uncontactable and owes money. Offer them the same account, same details, etc, or recommend an alternative reseller to move their sites to. It's times like these you have to consider those hundreds of people relying to getting quality support. If this guy won't do it, you might as well do it for him.

People deserve some slack - things happen. We've had people who've been late every month for 1/2 a year at a time. :rolleyes: but they get it together at the 11th hour and all is good again. As it's reached the point where he either pays up, or the lights go off, then that's the point where you should try to help out those accounts that are going to wake up to find themselves off the air. Some of these people may have children and rely on those sites to put food on the table at night.

I seem to remember about 6 months ago another host has the same problem with a reseller turning to smoke. They ended up taking the accounts over, and managed to retain a very high percentage of the sites. He even reported back here that many were very happy to hear from him, as they'd been worried about something like that happening for a while...

Greg Moore

Originally posted by akashik
I think it's time to reach down past the reseller and contact those end clients about what's happening. That you're the upstream and are stepping in, in their best interests as their 'host' has become uncontactable and owes money.

I have a real problem with this approach. In the United States there is a law called the Fair Credit Reporting Act. That law states that businesses (such as a hosting company) cannot legally share any credit-related details of their customers with any 3rd party. In addition, as a web host you should (and probably do) have a privacy policy that also states that you will not share any information with 3rd parties.

In addition to those two things, you likely either have a written or stated agreement (and even if you don't, you definitely do have an implied agreement since it's the nature of reselling) with that reseller that under no circumstances will you contact their customers (that is the nature of reselling - the upstream hosting company does not exist as far as the reseller's customers are concerned), and you'll also be violating that agreement unless you have a written agreement to the contrary.

If you go off and tell all of this reseller's customers that he hasn't been paying and that they should find new hosts, you are violating both the Fair Credit Reporting Act and probably your own privacy policy, as well as the implied or stated agreement to not contact a reseller's customers - and if that reseller later comes back and says "hey, what the hell????" you could be in some *serious* legal trouble.

Although it goes against common sense and against every inclination that we have as web hosts, the only real, legal solution here is to just shut the account off and let the end user customers deal with the reseller. It sucks, and it might make you some enemies among those end-user customers who are aware of your existance, but it'll keep you out of court and keep you out of hot water.

Do what you want (it's your company) but I'll stand by my statement that contacting a reseller's end-user customers is a very, very bad idea, regardless of what the reason is.

Jason

That's a very valid point, and something to keep in mind for sure. I still feel it's a case of looking after those people that will be affected by this one persons actions. It's not just against common sense, but grossly unfair to the people who put their trust in this guy to keep their site online.

I'll be clear in saying I'm not arguing the point here - the law and common sense in many cases parted ways a long time ago. It's a little sad we're know in a postion that the defence of one person makes up for the suffering of many. Even having read your post I think I'd be very hard pressed to just pull the plug on those people.

At the very least it's something to consider when contructing a reseller agreement.

Greg Moore

Just to clarify
I had nop records of any of these customers and was only able to contact 77 out of 182 by using the publiuc whois system.

All who have replied have been glad to be helped so far so I don't think there is an issue here.

Gordon

Originally posted by GordonH
All who have replied have been glad to be helped so far so I don't think there is an issue here.

Gordon

I think they mean the reseller (your actual client) having a problem with this, I'm sure these others appreciate it, but...

I would have just shut off the account personally, but maybe having a clause in the reseller agreement about this, so you don't have to make hard choices such as this (plainly stating that under no circumstances would you ever contact the end user, *unless* yadday yadda yadda).

Seems fair to me, and having it written out and agreed to would make it more kosher for everyone involved. Agree/disagree?

Gordon

You cannot change the rules in the middle of the game. Your plan of action would be dicated by what your contract states with your reseller.

Obviously if I had 1000 resellers and some of them are late on payments then there's no way I would be able to support them for a month let alone 2 months. And the bigger I was then the more strict I would have to be to protect myself from defaulting on my payments to my NOC.

Yes
I should have stuck to the terms of the contract and terminated his sites when he defaulted and couldn't be contacted,
It was the clear cut thisng to do according to the TOS.
Oh well, we live and learn!

Gordon

After having a reseller paying with stolen credit cards and the hassle I had with the FBI, owners of the stolen cards, etc. I would have preferred it if he hadn't paid at all.

The funny thing about the situation was that after I closed him down, he tried to sign up again about 3 weeks later with a different name and domain but using the same email address. :uzi:

I really think it depends on several factors.

Who is your client? Are you completely in the background?

How long has this reseller been with you? Is it possible that there was a family emergency and they have simply gone away for time?

You really have to answer alot of these questions yourself. But if you are not in the background, then I would think you would be okay to contact the clients after a short time, but if you are in the background, your obligation to your client is something else.

Either way, it sounds like this was a good client at some point. I would give him/her more than a week or two to show up.

Chris

Sorry, I just realized that was actually an old post.

Never Mind :-(

Chris

Theres nothing truer than,
"You get, what you put up with, and if you put up with it - you'll get it!"

I feel sorry for everyone! the customers of this reseller and for the decent web hosts out there - who yet again have had their credability knocked by the countless disgruntled customers that Gordon hasn't been able to contact. Who's faith (and the countless friends they tell) in our business has been lost.

Eladesor.

Gordon,

You may want to see this thread, Something similar happened to us and this is how fellow WHT members had respnded

http://www.webhostingtalk.com/showthread.php?s=&threadid=6526

Regards

I think its a real simple issue...

For us, clients that we have a long relationship with we will be easier on billing, and will let them slack a little.

New clients, you dont pay, you get no service.

Its not right for the customer to take advantage of the hosting company they use, just as its not right for the hosting company to provide bad service.

We actually send out invoices 1 week before there due and then bill them on there due date. 3 days later if they dont pay we send a 72 hour cancelation notice. If they dont pay after that, it goes off.

Now if they contact us and explain the situation, give us a date when they will pay, we will usually honor that.

If you communicate then most will adapt based on the situation. If you ignore the situation, that shows ignorance, and I dont like that

Joe

I read this thread with a mixture of interest and sheer wonderment at some of the comments but here's my 10 penneth worth, all provided with hindsight.

Assuming the client defaults on payment after say 30 days (which is about the norm here in the UK):

Option 1. If you want to be able to inform the 3rd party clients through their own publicly available contact information then include a paragraph to that effect in your TOS.

Option 2. To avoid personal contact you could always kill the resellers site (assuming that they are on your server) and replace it with an error page stating that service for the resellers has been halted and to as an act of kindness resellers clients will be allowed X weeks to move their sites to a new service.

Option 3. Just close the sucker down as per your TOS as per your contract with the reseller.

To be honest I think Gordon did the right thing and the attacks made about his ethics were pretty out of order. After all, you don't have angry kids ringing up Haribo demanding their sweets when the corner store doesn't have any in because of non payment to the supplier.

All in all though I'd say pro-active measures would be best but like Gordon did, constant attempts to contact the reseller in question would be very much in order.

That it was a teen queen with narry a machine is just grist to the mill.

Good luck with future dilemmas Gordon