Man at track starting block

Is a new client eager to start? Get their deposit first!

Have you ever had a client who was in a hurry to start… but they didn’t want to pay a deposit up front?

That’s a recipe for disaster—but remember that you’re in control! If they’re in such a hurry to start, they can be in a hurry to pay.

Here’s a cautionary tale from my agency career—and then advice on how to get clients to pay deposits at your agency.

The Eager-to-Start Olympic Athlete

Early in my agency career, I inherited a project working with an Olympic athlete—the agency would do a photoshoot, website, and print materials to support the athlete’s public speaking platform. It would be a mix of cash and trade (with celebrity appearances).

The agency owner was super-excited to be doing the photoshoot—which led to our scheduling the photoshoot before defining a final scope, much less getting a deposit. In retrospect, I should have pushed back on their enthusiasm—but in the end, I ultimately pressed for a tiny deposit before we’d do the photoshoot, with an additional payment due before we’d deliver the high-res photos.

When I reached out to coordinate the second payment, the athlete’s agent shared bad news—they lost their major sponsor, and they had to pull the plug on the entire project.

We got $500 for $5,000 in work… around $12/hour.

It was a terrible experience—but as a PM, I vowed to never do that again!

That’s part of what you get when you hire an employee or contractor with more experience—they’ve made the mistakes at a previous agency, so they won’t make them again at yours.

How to Avoid This at Your Agency

Based on my experience learning things the hard way, here’s how to be smarter at your agency.

1) Don’t start work before receiving a deposit and a signed contract. If they’re truly in a hurry to start, they can pay you in a hurry. You can use my Reason-Options-Choose (ROC) framework, including some key phrases to encourage them to move forward.

2) Give clients payment options that meet their needs. I love taking payments via credit card. Sure, there’s a 3% merchant fee—but I know immediately if someone’s paid, versus the old “check’s in the mail” situation.

3) Build this into your kickoff process. In my case, I won’t even schedule kickoff until the payment’s in. That way, if someone hasn’t paid, I don’t have a meeting looming. This eliminates collections pressure on you.

4) Don’t deliver final deliverables without full payment. Structure this into your contract—because otherwise, you have no leverage if they withhold the final payment. Ask your lawyer about a clause to make the intellectual property release (transferring the IP to to the client) contingent on payment.

5) If you do relax your policy, be sure to call it out to clients. They need to know they’re getting a special deal, so they don’t expect this every time. Otherwise, you’ll get buried in custom demands.

Question: How do you handle this at your agency?

Image credit: Starting-block photo by tableatny, via Creative Commons

Turn your digital agency headaches into profits.

Join leaders from 1,800+ agencies and get my articles delivered each week, directly to your inbox!

Learn tips to grow your agency, and get a copy of my ebook, Don't Just Make the Logo Bigger, for free.

Share This