Operating a successful advertising agency as a small business requires excellent rapport with clients and a reputation for conducting viable media campaigns. When a client refuses to pay for a media debt, it can not only impact the business's income, but it can also hurt its reputation if the advertising agency is forced to use aggressive collection practices to secure payment of the debt.
Contact the Client
If the debt is less than 30 days past due, contact your client directly and remind him that a payment is due. Mistakes happen, and bills sometimes get lost in the shuffle of paperwork. A friendly payment reminder may be all that's necessary to collect your media debt and preserve your relationship with your client for future media campaigns. Try leaving a weekly payment reminder by phone, in addition to re-mailing your invoice for services performed for the client. If these strategies are not successful, you may be forced to employ more drastic debt collection practices.
Exercise Ownership Rights
If your client is staunchly refusing to pay you for media work, any contract agreement entered into by you and your client may be considered null and void. This means you retain ownership to any creative works produced for the client's business, including promotional materials, photographs and design work. You should first contact the business in writing informing it of the duty to cease use of all advertisement materials created for the delinquent account. If this strategy is unsuccessful, you may be required to retain the services of an attorney and sue your client for breach of contract and/or copyright infringement.
Pull the Advertisments
Once you have retained an attorney, you may instruct him to request all media outlets currently running advertisements with your copyrighted material to pull them from rotation. Most media outlets usually comply with these requests rather than risk being embroiled in a copyright infringement lawsuit. Requiring the removal of your client's advertisements may be the show of force necessary to communicate your serious intent to collect the debt owed to your advertising agency. This is a serious escalation in the collection process which will more than likely end any friendly exchanges between your agency and the client.
Debt Judgments
If the debt owed to your advertising agency is relatively small, you may be able to secure a judgment for repayment through Small Claims Court. The ceiling on debt for Small Claims Court varies by state but usually falls between $1,500 and $15,000. An attorney is usually not required to file a petition with the Small Claims Court. A judgment to repay a debt may also require your former client to return any promotional materials which are owned by your company and pay your court costs.
Tags: your client, advertising agency, Claims Court, Small Claims, Small Claims Court