Work you've finished and haven't been paid for isn't a filing problem. It's your money, sitting in someone else's account, while you cover the materials and the wages that produced it. That has a price, and almost nobody works it out.
This is the number worth having in front of you next time you decide whether to ask for a deposit. I'll email it to you.
Tool 8 in the book is the receivables triage \u2014 sorting what's owed by age, deciding what to chase and in what order, and the wording that gets a thirty-day invoice paid without wrecking the relationship. There's also a chapter on why this stops being a problem entirely once you take deposits.
The business side of a skilled trade: what to charge, which jobs pay, and what it's worth without you. Twenty-one tools.
Not out yet. The form above is how you'll hear when it is.
Unpaid invoices don't feel like a cost. The money is coming, eventually, and nothing on your bank statement says "late payments." So it never gets counted.
But you already paid for that work. The materials went on the card. The wages went out on Friday. The fuel went in the tank. You funded someone else's cash flow with your own, and if you're carrying a balance anywhere \u2014 a credit line, a card, a supplier account with interest \u2014 you're paying for the privilege.
The second cost is worse and even less visible. Every hour you spend sending statements and making awkward phone calls is an hour you didn't sell. At a hundred dollars an hour, six hours a month is over seven thousand a year, spent on work you'd already finished and already invoiced.
Not the total. The gap between your terms and reality.
If your invoice says fourteen days and you're paid in forty-two, you're extending twenty-eight days of free credit to every customer, without having agreed to. Across a year that's a permanent loan you're making, and it's the reason so many busy trade businesses are short of cash while their books look fine.
Closing that gap is worth more than most of what people try instead. It doesn't require new customers, higher prices, or working longer. The money is already yours.
For residential work paid at completion, it should be close to zero \u2014 the card goes through before you leave. For commercial and builder work, thirty to sixty is common and it's the reason many trades won't take it without a deposit. If you're doing residential work and averaging forty days, that's a process problem rather than a customer problem, and it's fixable.
Run it against your borrowing rate. A three percent fee to be paid today, versus fourteen percent annualised on money you wait forty days for, plus the chasing time, is usually not close. The fee is also predictable, and predictability is worth something on its own.
You can, and it rarely gets collected \u2014 but stating it on the invoice does change behaviour, because it signals that you keep track. The more effective version for small trade businesses is usually a discount for paying immediately rather than a penalty for paying late. Same gap, better conversation.
Decide early what it's worth. Chasing a small invoice for six months costs more in your hours than the invoice is worth, and the real damage is that it teaches you to distrust the next customer. Write it off, take the lesson about deposits, and don't work for them again.