What length of time is standard from sending off an invoice to receiving payment?
How long would you generally wait before getting back in touch? What would you then do, send another invoice, a polite phone call...??
Any thoughts and ideas appreciated. --- Rab Harling London based AC
When I send in an invoice, it depends on whether it was for equipment I rented or for services rendered. For equipment rented I usually try to get payment in full upon return of the equipment. Most companies I deal with are ok with this. For those that aren't, I give them the requisite 30 days net. For services rendered (modelmaking, rigging, etc) it's usually 1/3 up front, 1/3 upon delivery, 1/3 in 30 days. Again most companies are ok with this relatively standard time schedule.
Ok, so for the other bad boy companies that take their time..... I've found that a phone call after 1 months time almost always gets the check out. I will ask them at that time ""when can I expect the check"" and if I sense something amiss I'll ask for some honesty with ""is there a problem with the invoice"". For well run professional companies paying bills is done on time.... it's just good business to maintain good working relations with your suppliers and they know it.... they stop paying I find because they themselves have a financial problem.
And then again there are, always have been and probably always will be those companies who seem to do everything they can to keep your money as long as they can. I think their philosophy goes something like this..... Why pay to piss someone off when you can do it for free.
Justins guide to getting your money and sitting on it ...
Invoice ... (stating 30 days, make sure you have all the info on it)
after 30 days ... call up veyr nice and friendly ask ""Did I invoice you for such and such a job ?"" Make out that it could possibly be your fault. Of course it won't be BUT you can make sure.
1. They have your invoice 2. It has been signed off by the producer. 3. See no2 above .. you therefore have no dispute with the producer.
as long as there is no dispute. You can politely remind them that the account is overdue and could they please pay it quickly.
If there is still no cheque after another 5 working days. Then you can reasonably call them up and ask why you haven't been paid. If you fancy the hassle then you can ask when it would be convienient to come and collect the cheque. If you don't want to actually go and collect the cheque ... (which I think is a pretty sad state of affairs anyway.) Then a letter form the Union usually helps a bit.
If all these fail ... then basically your relationship with the production company is over.
A good move is to ask the production accountant/manager up front, what are their terms regarding contractors invoices. Thirty days is a reasonable amount of time to have elapsed before making enquiries I feel - after that, maybe fax off a copy of the original with a friendly reminder written across it.
Another idea is to call and say that you're not certain if you mailed it to them which happens more as I get older ;-) and to check to make sure it's in their system. Here's a good moment to drop a reminder.
BTW, I called an accountant at a particular production office yesterday to ask about an invoice that is more than 79 days overdue. She told me that she will be opening the office mail shortly, and if any cheques have come in for them, she will try and pay me in the next two weeks. This not the way it is most of the time I'm pleased to say.
PdV Sydney, Australia
I usually invoice a production company on a thirty day basis, with the following tag line featured prominently on the bottom of the invoice:
Invoice is payable and due upon receipt. Invoices not paid by XX/XX/XX (30 days after invoice date) will be subject to a 10% (ten percent) service charge of $XX.XX.
Then, if i don't receive the cash by the end of thirty days, i simply call the prod.co. and ask about the invoice they recieved... and when they hem and haw, i simply fax off a new invoice with the additional service charge attached... works every time...
The easiest defence in this situation is to say, look, if you didn't pay your phone bill on time, would the phone company let you float for a few more days free?
just my $.02
The best tactic I've ever seen is by a resource of mine who highlighted his terms: 5% DISCOUNT, TEN DAYS. a much friendlier motivation ... of course, if they're gonna burn you, they're gonna burn you ... keep in mind to that lots of vendors, particularly agencies, pay on far from a 30 day schedule ... putting the heat on everybody ... I guess there's no easy solution ...
BTW : I don't think a ten percent penalty would hold up legally ... I post a 2% a month, but still ... try to get it ...
I now do most of my work on payroll rather than invoice, but when I do invoice for my services I generally invoice separately for expenses as ""due on receipt"" and for my services ""net 30 days"" with a penalty of 1 1/2% per month after that, which I believe is the max allowable here in the USA At 30 days I generate another invoice showing the new total which usually scares up a check for the original total. I don't push to get the 1.5 %...I know i am unique, but most producers consider my services to be a comodity they can purchase any number of places and I cannot afford to scream about 1.5% and lose the client's good will. Every once in a while a client who has not paid in the first 30 days just pays the penalty without protest. weird! Mark
It is not the end-all to timely payment problems, but I am a firm believer in the art of the Deal Memo, no matter what kind of project you are working on. If you have an Agent it is the agent's job to ensure these bases are covered. If you don't have an agent, there is no reason why you can't draft an acceptable Deal Memo yourself. This also allows you to document other addenda such as per diem, release of your work, travel, contingencies, etc. (all of which are of course negotiable). In my experience, it is always best to address these issues up front. If an employer doesn't agree with terms and payment schedules, the contract gives them an added impetus to address the issues before the job begins.
sample Deal Memo point:
3. I will bill by invoice, and first half payment is due upon completion of photography, final half payment will be made on or before . . . .
I am afraid that the companies that owe me money from long jobs all had deal memos...they don't contest that they owe me the money...they just claim that they don't have any.
I have not experienced a difference in problems getting paid between my ""handshake"" jobs and my ""Deal Memo"" jobs. For the years that I worked in NY as a gaffer I did a lot of short jobs for which iIwould show up with a crew and a grip truck based solely on a conversation with a UPM I didn't know, a fax'ed call sheet, and a fax'ed copy of a proof of insurance from the production company. The vast majority of the clients we met this way paid us on time (or nearly so) and called us again, and many recommended us to their friends.
While I am not suggesting that a Dal Memo is in any way a bad thing, and while I firmly believe that getting the terms of an agreement down on paper can circumvent much adrenaline-raising disputation later, I want to caution anyone against the mistaken belief that a piece of paper will get you paid when they don't want to pay you...contracts work well with parties that are honest with each other and not so well otherwise. I will say that when it starts feeling funny and you start hearing plausible excuses for why checks are bouncing or not showing up, you are probably about to get screwed. I have only ever bounced one check in my entire life, and that was a bank error not mine. I have only had one payment check bounce on me that was immediately rectified...in every other case there were long, drawn-out scenarios surrounding our finally getting our money. I used to worry about the perception of not ""trusting"" producers who had good excuses...I now figure that at the point that i am not paid on time or paid with a bad check, the producer has lost any claim on my trust whatsoever...I probably won't work with him or her again anyway, and I am more interested in getting my money, my crew's money, and my company money than I am about inadvertantly insulting a producer by causing him or her to lose face.
There is a real problem with small production companies which often get stuck in a cash-poor situation because they have to pay us and their big behemoth of a client is late in paying them. Notorious 400lb (182kg) gorillas in my past include AT&T, IBM, GM, and Bell Telephone. My feeling has always been that if a producer is up front about the fact that they can't pay me until they deliver the product and I agree to do the job, so be it. If they complain later to me about this problem I have no sympathy. I always end up explaining that my suppliers and landlords won't cut me any slack and etc etc etc blah blah blah.
P.S. My apparent ""sloppiness"" in going to work without a signed deal memo has been pointed out as an indication of my naivite and hopless optimism about human nature in general and producers in particular. On balance I do not think I have been burned any more than my more suspicious ""negative"" co-workers have ...but my naive view of the world is easier on me.
Per Scott Mumford's request, see attached Simple Text sample Deal Memo for a location shoot. It doesn't address the late payment issue that was in the original invoice post. It is not uncommon for a contractor to bill 1.5% per month (18% annual) interest for late payment in excess of 30 days on a 30 day net invoice. This is no different than what a doctor or dentist would charge on a late bill. As an ""employee"" on a time card (in the US) technically the employer has 24 hours to pay for services rendered. Typically one week grace is given until the Thursday or Friday on the following week, allowing the employer of record adequate time to process payroll. The bottom line is if an employer can't pay in a timely manner the only thing you can do is make sure you are covered contractually if you need to press the matter from a legal standpoint. Generally, a producer will not sign a deal memo if they anticipate a problem paying you in a timely manner. I can almost guarantee that they won't book you on a Pay or Play unless they have been awarded a job and have firm confirmation on the dates. -Mark Simon
this topic is interesting. The thought occurs to me wondering why we don't start taking Visa and Mastercard.
Here's the idea.... Sign a deal memo outlining the exact payment for the shoot. The deal memo should have on it the credit card number of the person who is paying. Before the shoot call the credit card company to verify the card is good. After the shoot, simply submit the card number for payment. If the producer balks then you have the deal memo to back up your side of the story.
Drawbacks are a bit more delay in payment and a credit card surcharge as a vendor. But if you are stuck with folks not paying or paying several months late then this might be a way to solve the problem.
I'm seeing a bunch of corporations who are beginning to REQUIRE that their vendors accept credit cards as payment.
"Deal Memo (date)
This is to confirm that you, acting under your company authorization, have retained my services, as the Director of Photography, on the above mentioned project as per our telephone conversation.
1. I will Travel to __________________________ on (Day & Date) _________________. I will Prep____________________ on (Day & Date) _________________. I will Shoot on (Days & Dates) _________________. I will return Travel on (Day & Date) _________________.
If there are Contingency Days in the schedule, the rate for work performed on these additional days will be billed at $__________ / Day.
2. I will be paid a day rate of $____________ for all Travel & Prep days (ea. of ___ days @ $__________ ) I will be paid at a rate of $ __________ / ______ hr. Day for Shoot days (ea. of ____ days @ $________ ).
3. Overtime will be paid on Shoot days at a rate of $ _______ per hour when the work day exceeds ______ hours / day
4. The production company will provide 1st or Business Class Air Transportation, and is responsible for Hotel room and taxes, and will provide automobile transportation while on location.
5. Per diem will be paid at a rate of $__________ / Day for all days to include Travel, Prep & Shoot days.
6. I will bill by invoice and payment is due upon completion of photography.
7. This booking is subject to a pay-or-play arrangement. If the job is canceled, moved or shortened, ______________________ will be billed for the full amount of the salary mentioned in this deal memo.
8. A Beta SP of the completed project will be provided to me.
9. Please sign below and FAX back to acknowledge receipt of this deal memo. Please immediately acknowledge any questions or problems regarding this contract. Signatures of both parties signifies the acceptance of all terms of this agreement.
Director of Photography _________________,
Executive Producer for _____________________