Hello, all i was just wondering how to manage customer who pay but not on time. They dont bother to pay until u send them a few notices or cut them off their service.

Also is this a common factor in hosting industry whether it be web hosting or dedicated servers ?? I would appreciate expert opinions on this issue.

This is a relatively common thing in hosting (in that it's not rare for some customers to let their account go overdue). Although one would hope that, in your case, such behaviour is only prevalent in a minority of your customers?

A great thread on this very issue (6 pages long) can be seen at:

http://www.webhostingtalk.com/showthread.php?t=862698

With any subscription based service you're going to get people paying late..

Introduce incentives for them to pay on time..Have solid payment policies in place and enforce them.

Sometimes people just forget to pay EVERY single month. We got around this by forcing PayPal subscriptions via WHMCS. Now when any client signs up, they create a PayPal subscription and their payments are processed automatically on the due date, unless their PayPal account has insufficient funds. This has been working great and barely see any overdue invoices now.

As Rameen stated, always enforce your policies with an iron grip. :smash:

Yes it's common most of website owner do not bother untill you cut them off their service.

But you can do these start sending them reminder mail at lest from 15 days before so there is chance to get some good result.

Have it automated as much as possible for handling delinquent accounts. There are just people who even if you send very early notices will not pay until service is cutoff. The users do not pay their accounts are disabled unless they contact you. This pretty much removes most of the headaches you have to deal with. We have users who do this every month but well they do end up paying and we do not intervene in any way.

I have to agree with everyone here so far, its going to happen. It is part of business but there are things you can to lesson the occurrences. Automated subscriptions is a good start. Make sure your payment policy is in writing where clients can see it, when you suspend, and when you terminate an account. Most importantly always enforce it!

We pretty much do manual processing.

Question: Do any of you people who used automated processes find that the people leave etc. because you're FORCING them to pay using some form of e-commerce method?

Basically, i'm asking about the manual to automatic switch-over. I foresee a lot of bitching..


Lawrence

Does not matter, i have customers from 3rd world countries who dont have paypal or a credit card and mostly depend on cash payment system like western union or moneygram. How do u deal with that ??

Get them to pay up front for a significant amount of time.

Does not matter, i have customers from 3rd world countries who dont have paypal or a credit card and mostly depend on cash payment system like western union or moneygram. How do u deal with that ??

I wouldn't say we deal with all countries, but a few wire money directly.


Lawrence

I've switch from manual to automatic and it helped quite a bit. I gave clients TONS of warning, let them know it would be automated (I am a soft touch), and added a $10 late fee if they go beyond a 10-day grace period. This combination has made an amazing improvements. I was shocked $10 made so much difference.

They also get several notices - initial billing, reminder, and 3 overdue notices before they get suspended. So they have lots of opporutnities to remember.

btw, on my whmcs, i allow mail payments, so they are not forced to use online payment. many of my hosting clients are left over from my web design days and that's how most of them paid.

We enforce an overdue invoice fee if an invoice is left unpaid for a certain amount of time. This will help encourage clients to avoid having to pay the extra fee just because they decided not to pay the invoice on time.

I dont know if this would work for you but i invoice everyone at the start of the month even if they renew the 1st and then i give them till the end of that month and if any of them customers havent paid i suspended there acocunt. I used to be worried doing this because people would leave but at the end of the day you dont walk out of a supermarket and pay a month late. you get what you pay for and if you pay nothing you get a suspended account. It also makes them contact you very fast!

One of my customers had a domainname that needed to be renewed and i told him to renew this by paying and he said he will 3 weeks later the domain went down and now hehas had so much hassle from his company.and he has asked to be put on automatic payment because of this,.

Sometimes people just forget to pay or they dont read emails, 9 times out of 10 the payment is on time and, it tends to be the same people who have late payments

I combat this the simple way...very low "late" grace period.

If they are much late at all, service is suspended automatically, unless they make prior arrangements. And even then, I only let it slide once or twice.

Nothing gets attention and payment like suspension. But line it out in the TOS, and have all customers agree to sign up. Some of the best hosting companies do this....up front and quick suspension on non-payment.

I combat this the simple way...very low "late" grace period.

If they are much late at all, service is suspended automatically, unless they make prior arrangements. And even then, I only let it slide once or twice.

Nothing gets attention and payment like suspension. But line it out in the TOS, and have all customers agree to sign up. Some of the best hosting companies do this....up front and quick suspension on non-payment.

Well, all hosts should do that anyway

I just had a customer of a Fully Managed VPS who was 5 weeks overdue but I kept him online as it was for business use.

He's now decided the 50p late fee added due to it being overdue a month means we are treating him like a Bank, and hes just submitted cancellation.

Oh well...

But yes late payments can be a bit of a pain. I just try to get people on subscriptions wherever possible so it's automated for the most part.

Late payments are a nuisance - but unavoidable (at least for newcomer clients). Remember to be kind but stern and personally e - mail them if they are overdue (don't just rely on the automated mailer).