| Or learn how to use collections agencies.
At the very least, you can condition any additional work upon the settlement of accounts.
There is no way the label can get out of paying if you have delivered product and it has been accepted. They know this, but you guys are too intimidated to leverage it. No need for a whole union...it would only take a handful of you guys to put your foots down before the labels realize they can't borrow money from engineers anymore.
Net 30 means the net of the invoice is payable in 30 days from the invoice date. 2% 10 means that accounting can deduct 2% if they pay in full within 10 days. 2% is enough that it completely overwhelms the interest or investment value of holding that money 20 more days...in fact, with the prime rate where it is, it would overwhelm the interest value of nearly a whole year. When rational accounting gets a 2% 10 Net 30 invoice they will pay immediately unless they simply don't have any cash on hand. 1% interest per month on late invoices is nearly as bad as borrowing on a consumer credit card. Generally corporations can get better loan rates than that, if their credit is any good, and will thus find it a better deal to borrow that themselves from a lender rather than pay the interest for the invoice.
You are just trying to make the decision tree favor prompt payment. You have contract law on your side! But if you are too timid to use it, then the decision tree favors guess what? |