For those who sell services online, beware of the SCAM CLIENT. The biggest downside to working online is the fact that you have NO GUARANTEE that the other party is going to pay for services rendered. Even if you DO have a Service Agreement, it’s difficult to ensure that the information they’ve provided you with is authentic.
Unfortunately, without the proper address, client name, and phone number, it’s near impossible to collect. And working with people outside of the USA is even worse because the same laws as we are here in the states do not govern them.
BUT don’t let that little fact scare you away from working online! For every SCAM CLIENT, there are about twenty good clients. Maybe one out of twenty is one too many; I would agree. All it takes is one bad apple on a website like http://www.Elance.com or http://www.Guru.com and your reputation could go down the toilet.
To ensure you’ll be paid on services rendered, make certain you DO have a Service Agreement. Outline every aspect of the agreement carefully. Use easy to understand terms and include a Payment Schedule. Join an ‘advocate service’ like Square Trade. Although Square Trade doesn’t collect the money from a client that defaults on payment, they will assist you in finding ways to collect for a price.
If you’re working through a third party, like Elance or Guru, use their investigation team to pursue the client. Make sure you have a legal clause in your Service Agreement that states the other party is responsible for any additional cost. USA businesses may be able to collect on services that exceed $1,000 by using the Small Claims Court if the client resides or does business in the USA.
Whether you are doing business online or locally, it is tough. Always someone out there will try to take advantage of you. Stay on your toes and use the legal system the best you can.
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