Diana Ennen, owner of Virtual Word Publishing, a publicity firm based in Margate, Fla., said she first started seeing a slowdown in payments about six months ago.
"In the last four months, it's gotten really bad, and almost at a critical point," she said.
Ennen's late payers tend to be people who work as independent contractors for companies which, because of the uncertain economy, suddenly decide to end the relationship. The independent contractor isn't getting paid anymore, and in turn is having a hard time paying Ennen.
When clients are behind, Ennen said she's careful about how much new work she'll do for them.
"I try not to get too far in advance, and I have to see some payment," she said. "You can't do a lot of work now and hope the payment will be there."
She has other ways of protecting her receivables - asking for a retainer or a credit card number, so she can be sure she'll be paid. Ennen said that because most of her work is done via the Internet, and she never actually sees her clients, "there is more of a tendency for the 'check is in the mail' syndrome."
But Ennen also tries to help her clients, telling them, "because I do publicity, let's do something that would generate some money."
Danielle Gibbs estimates that about 40 percent of her clients are paying late.
"They're having problems getting their customers to pay them, making them a little slow to pay me," said Gibbs, who owns Minneapolis-based DVA Brand Communications, a marketing and public relations agency.
Gibbs said she's found that her approach depends on the client.
"Most of my clients are pretty long-standing clients ... I can understand their position," Gibbs said. "With some clients, we've worked out a payment plan. We allowed them to get behind, now we need to get back on track."
One client was paying quarterly, so ignoring two invoices put the customer six months in arrears. She's had to tell the client to start paying, "or we're going to continue to get more and more behind."
This experience has taught Gibbs to change her payment policy. She's now asking for a deposit up front, before the work even starts.
Roberta Bernhardt, a partner with the accounting firm Citrin Cooperman in White Plains, N.Y., said small businesses need to have a systematic method of billing and a timeline for following up if an invoice hasn't been paid. Running your billing in a haphazard manner is a good way not to get paid on time - or, in some cases, not to get paid at all.
Bernhardt also said an owner should set a limit on how much credit or leeway a client can have.
"You don't want to get in the position where the client's in the driver's seat - they owe you so much money, you can't afford to stop working with them," she said.
And, "when it gets up there, you need to let them know you won't do any more work for them," she said.
Like Ennen, Bernhardt recommended using credit cards as a way to get payment. She said customers are likely to agree because "they feel they have extra time to pay."
Some owners might not want to pay the credit card processing fee, but Bernhardt calls that "a small thing to pay to get your money right away."
If the customer still isn't paying, Bernhardt's advice is to keep contacting him or her until you get that check.
"The squeaky wheel is the one that gets paid first," she said. "If you're the one that's going to be firm about your collections, you're going to be the one that gets your collection." And if they're just not paying, and show no signs that they will? There's always legal action, or collection agencies. You'll need to balance how much you'll get with how much you have to pay to get it.
