As a small business owner or start-up founder it can sometimes be tempting to start work on a project without a contract. Sometimes the one thing that isn’t considered is what happens if that client decides to pull out without paying for services already received?
Understandably it can sometimes be harder to pin clients down to contracts particularly if rival businesses are offering the same services contract free. The reality is without a contract in place, this puts you as a service provider at a disadvantage when pursuing unpaid invoices.
To protect your business, you should always have a general contract outlining your terms drafted up to cover yourself just in case you encounter a client that will contest what is owing.
If you decide to outsource your debt recovery, then it will make the process easier if there is evidence to turn to and use during the pursuit of unpaid debts.
If you currently find your self in a position where a client owes you money and you don’t have a contract with them, don’t worry, all is not lost. There may well be ways to uncover agreements even if they are made verbally to support your case if it ends up in the small claims court.
The important thing to do is seek advice from a professional so that any correspondence with the client is doesn’t undermine your case.