It wouldn’t now shock you if I’d say that not all clients created the same. As a business owner, you already know the difference between selling to consumers or small businesses like yourself versus engaging with a large company, perhaps an S&P500 giant.

Large corporations, especially publicly traded companies have lots of rules, policies, and processes that are in place in order to make sure that no one scams them and in order to allow good monitoring ability that helps auditors to do their jobs.

I would like to introduce you to two possible scenarios that are most common.

The simplest scenario is that someone within such organization reaches out to you and acquires your services. upon short discussion, this contact will send you a purchase order (or as it’s known is some companies Order ID, budget ID etc.add synonyms). While there is no formal contract between the client in you in this scenario, the PO (Purchase Order) will most ofter outline the budget, delivered goods or service and payment terms. In order to get paid in this scenario, you must study the terms closely and add the PO number or reference to your invoice. Also, make sure that you use the billing and shipping address stated in the order. Since these companies are huge and SOX compliant the people who pay you in accounts payable are not allowed to release payment to you without verifying your invoice to PO number, checking that the budget exists and goods are confirmed as delivered by the buyer, who will most often be your contact.

Pro tip – always CC your contact when sending the invoice via E-mail in order to help them following up with their accounting team if payment is not released on time or add their name to the address if the invoice is sent via post/FedEx.

The second scenario is a complicated version of the first one. Some engagements start with an RFP and continue to the contract signature. At this point, it is best to verify with your contacts regarding the payment terms. Make sure that the terms you sign and plan for are something that the client’s side can actually meet. Many times, agreements signed with X terms and state nothing about PO – only to disappoint you when accounts payables will refuse to pay your invoice without the reference and within X days you expect them. Since these organizations are highly bureaucratic they many times with disregard your signed agreement completely risking you taking (and probably winning) them to court. Since it is best for the business to avoid involving lawyers, your best course of action is to avoid such unfortunate situation, to begin with, and have your contact to provide the PO (actually assuring you that the company has allocated the budget for your project) and confirm that the payment terms and milestones can be met.

Your first interaction with the AP (accounts payable) will lead to request on their side to provide W9 and/or complete their vendor setup for or a vendor setup questionnaire.

They will usually hold payment until you complete these steps.

Pro Tip– make sure to send your invoices on time. While contract terms might state that payment is within X days past invoice date, many times AP will count the days since invoice was received and will completely disregard it if it doesn’t match 100% to their process.

To conclude: While large corporate clients usually represent a lucrative payday, they also represent a billing and collection challenge for you and your business making you to step up. Make sure that you are mindful of the extra effort you will have to put in order to meet their terms and get paid.

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