Most digital freelancers being left out of pocket
Almost six in ten web designers who are freelance have had
to wait as long as three months or more past their invoice ‘due date’ to get
paid - or they didn’t get paid at all, reveals a study.
Although those who remained unpaid made up just 14% of this ‘late paid’ group, the amounts they were forced to write-off posed a “serious risk” to their business, said FreeAgent, which commissioned the study.
Up to £5,000 was the most typical sum the freelancers had to absorb, but a handful were hit even harder – for up to £10,000, even though they had completed the work for the non-paying client.
In fact, ‘up to six months’ is the most common delay that the late paid freelancers suffered, but 10% (out of the 45% paid three months or later) had to wait up to a year, and almost as many (7%) had to wait up to two years.
Ed Molyneux, the chief executive of FreeAgent, described the findings as “eye-opening.”
They also show late payment among digital freelancers as “widespread,” he said, pointing to just a tiny proportion (3%) who said they had never been paid late.
His company will in January publish a book to provide freelancers with “practical finance tips” to help tackle late payment and other business-finance issues. A Field Guide to Freelancer Finances will also be available as an e-book.
In the meantime, Mr Molyneux advised: “Calling or emailing a client and asking them to settle their invoice once it’s overdue is a good start.
“But it’s also important to be more proactive from the outset in order to minimise the chance of a lengthy wait to get money that you’re owed. By setting clear payment terms up front, asking for part payment in advance, sending invoices immediately after work is completed and agreeing penalties for late payment, you may find you’re more likely to get paid quickly.”
Editor’s Note: Related Reading –
6th December 2015