the most well-known trainers have the occasional client who
doesn’t pay. It happens at all levels of the industry, and
in all breeds and disciplines.
If you are a professional trainer, there are steps that
you can take to reduce the possibility that your clients
won’t pay on time. If
you do encounter a client who doesn’t pay, you have options.
is Easier than Collection
have a limited number of stalls, and an even more limited
amount of time, so you want to fill your barn with horses that
belong to good paying clients.
Having a non-paying client’s horse in your barn is a
liability. Not only are you not being paid for your time, you
are also spending money out of your own pocket to feed and
care for someone else’s horse.
Furthermore, there is an opportunity cost - you could
fill that stall with a paying client’s horse!
So, how do you spot a deadbeat before you start hearing
a Credit Check on Prospective Clients
each new client fill out an application before coming to your
application should include a consent to a credit check. A
credit check may seem like overkill, but if you would run a
credit check before renting out your house, why wouldn’t you
do the same before renting out a stall in your barn?
Running a credit check can be as easy as a few clicks
on the Internet, and the cost of the credit check is very
inexpensive when you balance it against the cost of having a
non-paying client in your barn. Each of the three major credit
bureaus, Equifax, Experian
and TransUnion, offer
credit reporting services.
will a credit check tell you?
Sometimes, the folks who spend the most money on fancy
horses, tack and trailers are so heavily leveraged that they
do not have cash left over to pay their trainers, and a credit
check will reveal if a prospective client appears to have too
much debt. If a
prospective client has a completely empty credit report with
little or no credit activity, that is also a red flag.
Credit checks are a good predictor of how promptly your
client will pay you. If
a prospective client is not paying their phone or credit card
bills on time, they will not pay you on time, either.
Was the Client’s Previous Trainer?
training application should ask the client to list their
previous trainers and their reasons for leaving those
trainers. Even if
you don’t know the trainers well enough to contact them and
ask about the prospective client, what the prospective client
says about why they left can reveal useful patterns.
For example, if the client has had 10 trainers in the
last 5 years, you know that they will be difficult to please.
Taking on a client who has something nasty to say about
every one of their previous trainers is like dating someone
who is cheating on their spouse - eventually, the client will
be complaining to their new trainer about you!
Having an unhappy client in your barn is also bad for
business, because they can convince other clients to be
unhappy, and griping creates a negative and stressful
atmosphere that can impact the performance of both horses and
training and board should be billed and due in advance.
For example, in mid-January, you should send out bills
for February and require payment by February 1.
For new clients coming in, require payment for the
first month of board and training no later than the horse’s
arrival date. No
payment = no training. For
clients whose horses will be going to shows with you, require
the client to advance all show expenses, and bill the client
promptly for any unanticipated expenses that you might have to
pay for during the show.
are an equine professional, not a finance professional, so
consider hiring a bookkeeper to handle your business’
finances. It can
cost as little as $50 per month, and the bookkeeper will
likely pay for him- or herself. Your bookkeeper will send your
client invoices out right on time, even if you are away at a
horse show, so that payments can be waiting for you when you
get home. If you
are too busy to send out bills consistently every month, your
clients will suffer from sticker shock when they get one big
bill, leading to arguments about the bill amount and slow
bookkeeper can also help make sure your
bills are paid promptly, avoiding costly late fees and
interest. If you
travel a lot, you can have your clients send their payments
directly to your bookkeeper, who can process them upon receipt
so that those funds will be available to you instead of
languishing in your mailbox. Depositing checks promptly also
decreases the chances of bounced checks. With organized and
updated financial records, you can easily track your
business’ progress and use the data to make changes in your
your bookkeeper will have all the records you need when tax
Credit Card Payments
card companies do charge fees to process credit cards, but
those fees should be balanced against the benefits of being
paid on time and regularly.
Clients like credit card payments because they are
quick and easy, and they do not require cash.
Requiring a client to give you a credit card number
upon opening an account with you gives you the option of
running the client’s credit card if they don’t pay at some
point in the future. You
can even set up your clients on automatic credit card
up a merchant account that allows you to process credit cards
is easy, and if you have Internet access, you won’t need
special equipment. If
you use Quickbooks to
manage your bookkeeping, you can apply for an account directly
through Quickbooks. You
can also apply for a merchant account through your regular
bank. If you do
not want to set up a merchant account, you can accept credit
card payments through Paypal.
Late Fees and Interest
clients who choose not to pay you on time, charge significant
interest and late fees. Interest
and late fees serve to discourage late payments, and also
compensate you for not having been paid on time.
If a client has a limited amount of money to pay bills
in a given month, which bills carry the highest late fees and
interest will influence the client’s decision.
Most states have usury laws that limit what you can
charge, so consult with your attorney about your state’s
applicable limits. To
avoid misunderstandings, make sure that your training contract
is very clear about when payments are due, and when they are
late, as well as the applicable fees for late payments and
Clients Don’t Pay
your client has not paid you on time, follow up immediately
after the due date with a friendly phone call to let them know
that the payment has not arrived.
This is another instance in which accepting credit
cards is handy – you can ask them right there on the phone
if they would like to take care of the outstanding balance
with a credit card. Out
of town? You can
ask your bookkeeper to provide you with a list of overdue
accounts, and whip out your cell phone when you get a break in
the action. If you
get voicemail, leave one message, and then keep calling until
you get the client on the phone. It is a lot harder to ignore
a live person on the phone than a voicemail message. Learn
what good telemarketers know – you have the best chance of
getting someone on the phone during evenings and mealtimes. If
a spouse who disapproves of the client’s horse habit is home
to overhear the conversation, that increases the chances that
the client will give you a credit card just to get you off of
should you do if a client’s check bounces?
Your training contract should state very clearly that
you will charge a fee for a bounced check, and you should
collect that fee immediately, in addition to requiring the
client to replace the funds from the bounced check.
Agreeing to wait and then redeposit the check will
certainly result in delayed payment to you, and may also
result in a second bounced check.
Bounced checks are an indicator that your client’s
cash flow is not very strong, so consider requiring a client
who bounces a check to pay you only with a credit card from
a check that you are worried will bounce?
Take the check to a branch of the bank that the check
was written on, and ask them to cash the check.
For example, if your client gives you a check written
on a Wells Fargo account, find a local Wells Fargo branch and
present the check at the branch for payment. You can do this
even if you do not have an account with the client’s bank,
because banks are legally required to honor checks written on
their accounts (provided that there are funds available in the
account). Not only
will you find out right away whether the check will clear, you
will also avoid costly fees that your own bank would impose if
the check bounced.
training contract should have a clause that allows you to
terminate the contract immediately if the client does not pay
on time. Your
training contract should specify that if the agreement is
terminated, the client must pay you in full before removing
their horse or other personal property, such as tack and horse
your state may have a law that gives you a lien on your
client’s horse for unpaid training and board, trying to
sell a horse under the statutory lien process is typically
time-consuming and difficult.
For example, you usually have to retain possession of
the horse, and many states require you to obtain a court order
before you can sell the horse, which means that you must sue
the client and win. Furthermore,
once you have the court order, you may have to follow a
certain process, such as a public auction, to actually sell
the horse. All of
those steps present opportunities for error, and each one
takes time and money. Plus,
most of the lien statutes don’t provide for the sale of
other personal property, such as tack, that may be worth more
than the horse. Meanwhile, the horse is probably still in your
barn costing you money! In
contrast, if your training contract says that you can sell the
horse, tack, trailers, etc. to satisfy the client’s overdue
bills, you can just take care of it without having to rely on
a complicated legal process.
the sale proceeds are less than what the client owes you, you
can take the client to small claims court for the balance.
Most small claims courts have free advisors who can
assist you in filling out and filing the necessary paperwork.
In small claims, your attorney can assist you with
preparing and serving your documents, but cannot speak for you
in court. Contrary
to popular opinion, collecting on a small claims court
judgment is not impossible.
For example, if the client has a job, you can petition
the court to garnish their wages.
to Find Training Contracts and Applications for Prospective
Legal Solutions offers a forms
package for professional trainers that includes an
application and training
ELS also designs customized agreements for individual