How to manage client "deposits" of money?

[Susan06]

If you get a 50% deposit upfront and the client cancels the job later? Either a week later, or further down the track?

1. Do you take expenses out of the deposit if they cancel early on and then return the balance? Eg. If they cancel a week into it and you have already done

2. Or, do you make your deposit completely non refundable?

What strategy works best in the over all long run as well .?

 

[Nurudeen]

I think it's better to state out terms of service from the onset. How can a customer just cancel an order after paying 50% of the cash.

 

[WhiteHouse]

There should be a contract signed between both parties and the punishment for breach of contracts should have been clearly stated there. After then we know the next move.

 

[Peterlight]

You should have terms and conditions for your costumers and also make sure you state the condition of your work before they pay any amount and it is also upto you not to disappoint cos the only reason a customer could cancel a work done half way maybe because you exceeded the time frame you gave to him

 

[Abonyo Dickens]

We must first understand the reason why the client decides to do so. Maybe there is a conflict of interest or rather a violence in the place of work which may hinder the performance of their work. Then again in every business it's advisable to create terms and conditions within which the business operates. So any breach of contract always bares the consequences when it doesn't lies within the terms of contract.

 

[Kamon c4]

Right from the I collect the upfront I’ll make sure to note of every spending made on the project. If canceled I’ll deduct every penny spent and return the balance

 

[MizzLala]

When our clients accept our quote, before any work starts, we send them our terms and conditions about how we function. Those terms also stipulate that work will only commence on receipt of the 50% deposit. Should the client cancel when all work's been completed, then we retain 100% of the deposit. It's all in our terms of conditions. I always say with clients, you have to set expectations and manage them.

 

[Claraviolet]

We will have to consider the client opinion first.

They need to understand how their money is being transferred. If we give seller protection for a week or so, then it's better to not to process the amount right away. If there are any changes, we can always revert the money back.

Also, it's better to specify this refund information where it can be found easily. Otherwise we will have to deal with angry customers, all the time.

 

[Niftyyem]

Everything should be stated in your terms and conditions to avoid situations such as those. If a client t has the knowledge of what happens at the point of cancellation, the he'd prepared for it.