My hardest customer to satisfy has always been friends or family members. These have also been the hardest customers to collect from. Being in business for over ten years now, I’ve learned how to handle family and friends who become customers. So here are a few tips for you.

Get It In Writing

Early in my business, I contracted to build a site for some friends who had begun a non-profit organization. To help them out, I agreed to build a web site for them free of charge. Because it was free, I assumed they wouldn’t put too many demands on me. Boy, was I wrong!

They turned out to be some of the most demanding clients I’ve had. All of my web hosting is done through an affiliate allowing me to earn commission from each account. Well, the affiliate requires a credit card for monthly billing or they require that the client pay the account annually. Because they didn’t have a credit card and the annual fee was kind of steep for their budget, I agreed to put their hosting bill on my credit card and they agreed to pay me monthly. First off, there was the time, effort and costs that went into billing them monthly. Then, they were slow every month in their payments. Because they were friends, at first I was quite passive in my collection efforts.

Also, I had been negligent in getting our agreement in writing, so I was hesitant to cancel their account even though they were over 60 days past due. To rectify the matter, I forwarded to them a contract stipulating policies, etc. and then told them the site would be shut-off if I didn’t receive payment within 30 days. Fortunately, that time I received payment, but later I ended up having to cancel their account due to non-payment.

Don’t assume that you and your family or friend can work out your disagreements. Have everything in writing just as you would with any other client. Be clear on return or cancellation policies especially. If you know that they are difficult to deal with, consider referring them to a colleague and ask the colleague for a referral fee. Many people do much better working with strangers.