What follows was taken from a recent post in the Discussion forum. I had been wanting to do a brief article on using PayPal in our trade and this post gave me the opportunity to do it. For those of you who have not read the post, the thrust of it was "Why do we not require payment for our services up front?" While I do not usually require payment up front, I do sometimes require payment before I will deliver the work product. Here's my reply to the aforementioned post explaining why and how.

What follows was taken from a recent post in the Discussion forum. I had been wanting to do a brief article on using PayPal in our trade and this post gave me the opportunity to do it. For those of you who have not read the post, the thrust of it was "Why do we not require payment for our services up front?" While I do not usually require payment up front, I do sometimes require payment before I will deliver the work product. Here's my reply to the aforementioned post explaining why and how.

I do require payment at the time services are rendered with some clients.

If I get an order from someone with whom I have never dealt, and with whom I will probably never deal again, I tell them up front that upon my completion of their work they will be invoiced via PayPal and upon payment of the invoice I will forward my opinion of title.

Invariably three things happen next:

   1. They say that they have never done things that way before. I politely tell them that I understand, but that is how I work with new, out of town, clients.
   2. They then say that they do not have a PayPal account. I remind them that they do not need a PayPal account to pay via PayPal, and direct them to the PayPal site to learn more. They say they will look into it. I figure that half the time they are shopping around for someone else, but then...
   3. They call back and say they will pay via PayPal.

I have done this multiple times. Always with success.

When doing this it is important ...

   1. that you are polite and professional
   2. that you do not project an arrogant "take it or leave it" attitude
   3. that you are ready for their objections with the answers set out above

Since you are usually talking to someone lower on the food chain, and not the ultimate decision maker, remember to...

   1. Be kind, they are doing the best they can with the novel situation you have just presented.
   2. Adopt a helpful attitude and briefly educate him/her about PayPal so they can report back to their superiors knowledgeably.
   3. Point out that you are not requesting money up front. Remind them that they will only be billed upon completion of the work. Assure them that you are raring to go on their project as soon as they give you the word and "times a wastin."
   4. Do what you promise to do and send them the work immediately when they pay.

I do not do this with clients with whom I've developed a good working relationship, but I do monitor their payments carefully.

You take a certain amount of risk here by working without payment up front. However, if they do not pay you as agreed you simply do not send the work. It's better than submitting work that the unknown client uses then never pays you for.

Remember too that in the scenario I am describing, the client does not know you either. You at least take steps to alleviate their fears of the great unknown (namely, YOU) by not requiring payment until you at least purport to have done the work. Additionally, they have the hope of some recourse through PayPal for reimbursement of their payment should you utterly fail to deliver the product you invoiced them for.

There are two other things going for you right now that make it easier to take the PayPal approach I outline above:

   1. In the current fearful economic climate it is understandable for parties who do not know each other to deal with each other more cautiously, even if that means adopting new non-standard methods as long as those methods appear reasonable and secure.
   2. Over the years, in spite of its rather lame name, PayPal has come to symbolize security in internet payments between parties who do not know each other. It is the way to pay for goods and services on the internet. eBay saw this early on. That's why they acquired PayPal in a 1.3 billion dollar stock deal in 2002. A bit of PayPal’s image rubs off on you by using them. Guilt by association you know.

I hope this gives you some food for thought. As I said, I do not use PayPal across the board, but I use it frequently when the situation seems to call for it. It is one more tool for your tool box.

Sincerely,

David Case

wdavidcase.com