Liability & Legality

**epithet** · 08-31-2006, 06:32 AM

Hello everyone!

I guess the worst part of running an online outsourcing business is when your client runs away with so much $$$ left unpaid.

Is there anyway that this case may be minimized or avoided?

I tried to edit our work contract so as to give more security to our services but still it's so hard because I can't easily run after those clients since they're from another country.

SOS!

**bgmill** · 08-31-2006, 08:36 AM

The best thing to do is set out a payment plan whereby you get paid regularly and in smallish increments.

eg: for a $5000 job I'll normally ask for $2500 up front, then $1250 on the halfway completion point and final $1250 on final completion and code handover. To protect the buyer you can also hand over code at the halfway point too.

Or you can just break the whole thing down into modules and take payment for each one as it's completed and signed off.

Once they've run, it will be very hard (and possibly costly) to retrieve the money but there are companies out there that will take on international debt collection claims.

**epithet** · 09-02-2006, 07:17 AM

We do have a start-up cost, a one-time payment done before getting started. What happens however is that after a month of working for the client they just disappear. I suppose it won't be a good business strategy if I let them pay first before any work is done right? Our payment is really flexible so we can help them in their cost-cutting projects but then they don't help us in return.

What is that international debt collection claims?