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Monday, May 08, 2006

IT Consultants: Customer Credit

As head of an IT consulting company you should not give clients credit without thinking. If and when you decide to give them credit, keep them low until you have established a longer-term relationship with them.


When dealing with new IT consulting customers, you might want to start them out with just a $500 or $1,000 credit line, even if you get a credit application and good credit reference letters. They need to establish that they can pay small invoices before you give them $5,000 or $10,000, even if they need a lot of work.

You should get larger deposits and accept credit cards if they do need more work than they can at first afford pre a larger credit line, but don’t get yourself into big financial difficulties with new clients.


Particularly you are selling hardware and software products or peripherals, the financial situation can get bad quickly unless you insist on written agreements from your IT consulting customers. Verbal promises are an amateur practice and no longer hold much water in the business world. Say what you are going to do, how you will do it, when it will happen, the cost and establish a payment schedule, all in four to six sentences. Any larger IT consulting projects will require longer proposals.

Blogged By: Computer Consulting 101