Customer Refusing To Pay

Business By SweetpopTN Updated 6 Dec 2011 , 4:32pm by FromScratchSF

SweetpopTN Posted 1 Dec 2011 , 8:17pm
post #1 of 31

I am new to the sweets business and I wanted to know if anyone knew the legality of my situation.

I had a customer order an assortment of treats for an event. I normally take a deposit or have my customers pay in full before the event. This organization insisted on paying the day of the event since the event date was close. I made an exception for this organization and was going to pick up the check the day of the event.

Well, come to the day of the event and there were a few things that happened that were out of my control that ultimately destroyed their treats. We were able to remake their order but were late to the event. I was able to get them their sweets while their event was still going so we didn't miss the event but we were 15 minutes late to the start of their event. I had to deliver the treats in two waves because we wanted to insure we could get them something as soon as we could. The first wave was 30 minutes late and the 2nd was 30 mins after that.

They were obviously upset that we were not there on time and is refusing to pay for the sweets. They accepted all of the sweets and they were all consumed at the event. They are saying that because we were late, they shouldn't have to pay for the sweets. Obviously I disagree with them. They are now coming back and asking me how much my cost was to make the sweets and want to pay me just for the cost of the sweets.

I think it's a different story if they said, "It's ok we don't want your sweets" therefore they wouldn't have to pay for it. Since they took all of the sweets and passed them out at their event and all of them were consumed, someone should be accountable for them. I know that I was at fault because we couldn't get them their sweets on time but I shouldn't have to eat the cost of the whole order. I might as well not have shown up and ate the sweets myself. This is a form of stealing.

I would like your advice on this please.

30 replies
designdiva22 Posted 1 Dec 2011 , 8:32pm
post #2 of 31

That is outrageous that they won't pay you. I am not experienced in such matters but maybe you should approach the small claims court?

And please take a deposit next time regardless of the date of the event.

Dayti Posted 1 Dec 2011 , 8:45pm
post #3 of 31

I am at risk of sounding like the bad guy here, but what were the reasons out of your control for you being late? Of course they accepted your products for their event...what were they supposed to do at that stage, just have nothing at all? I actually think that they are being reasonable wanting to just pay your costs.

In terms of legal action, I am not actually sure who is responsible for what so you should consult your lawyer. If you have a contract which they signed and they were aware that there may be a condition that states non-delivery for reasons out of your control, you might have a leg to stand on...

AnnieCahill Posted 1 Dec 2011 , 9:01pm
post #4 of 31

First, if you have a contract and your policy is to get full payment x days before the event, don't ever make an exception. That way, it would have been easier for you to just offer a partial refund for your snafu instead of scrambling around after the fact trying to get the money.

I have to agree with Dayti. They needed something to serve so obviously they weren't going to turn you away. It may have been embarrassing for them not to have any snacks and then have the snack people show up late to the event. For that reason, you should offer them a discount or only charge them for the ingredients.

Sorry this happened but lesson learned for next time.

BizCoCos Posted 1 Dec 2011 , 9:18pm
post #5 of 31

If you were 15 minutes late to the event, then give them a discount, perhaps 15%. Although nerve wracking for the event hosts, you still delivered at a loss to yourself since you baked the items twice. I was an associate Executive Director and helped coordinat two major events. Time was messed up and instead of 9 am they were planning for 9pm (food), long story short, we called them, they were about 40 minutes late, no one died, no one starved to death. Unfortunately these type of glitches happen. I believe a discount is in order but not at cost to you. Your other option was to say I'm terribly sorry the items were destroyed.

SweetpopTN Posted 1 Dec 2011 , 9:46pm
post #6 of 31

Thank you all for your input. I greatly appreciate it. Yes it is a lesson learned indeed.

I am very willing to work with them by giving them a discount. That is not the problem. The problem is that they don't feel like they should pay one cent because we were late. I understand that it was our fault but like you said BizCoCos no one died and the people seem to have enjoyed the sweets.

Dayti- being a small business you don't have total control of the environment you work in. We are in a commercial kitchen space that is shared. Long story short the treats were destroyed and we had to remake them and that is why we were late to the event. Have you ever been dissatisfied at a restaurant for example and say, I don't feel like paying the full amount. Can you put together your cost for the meal and I'll pay that? That isn't even the case here. The case was timing. They enjoyed the product to the fullest. They did have other treat options like popcorn and candy so they wouldn't have had nothing at all.

jgifford Posted 1 Dec 2011 , 9:50pm
post #7 of 31

I think the main question is, did you have any sort of contract at all or was everything verbal?

Pyro Posted 1 Dec 2011 , 10:04pm
post #8 of 31

Hello , first I would like to say that your bottom line ( cost ) is no one's buisness. EVER.

Also, they accepted ALL your order, and in TWO waves. They didn't tell you " no don't bother delivering the rest, we're unhappy with your services ", they let you bring it all in, get passed around and be consumed. Im 100% sure the fact you were 30 minutes late to the event with the treats didn't destroy the event.

If it was such a huge issue they would have told you as soon as you got there and declined your order and tried to negotiate on the spot, not come on after it's all over and try to stiff you. Your dealing with someone who's trying to make a buck off you trying to use this as an excuse.

If you got there at the end of the event and most of the guests were gone and the food wasn't eaten.That would be slightly different but it seemed you were just a little late to that event.

You could offer them a LITTLE discount and maybe free delivery to amend but by no means should this ( eaten and enjoyed ) delivery be devaluated.

This is why you should never ever accept orders without some payment ahead of time, you tried to be nice and now they want to take advantage of you. If god himself came to destroy the treats or that you felt like playing garbage basketball with them as nothing to do with anything. You were just a bit late.

Tell them that due to unforseen events that forced you to redo their order at the last minute to make sure they received top quality goods, you were late to the event. End of topic. Offer them a small discount 10%? To offset any discomfort this might have brought them. And stick to it.

The bottom line, you brought it, they accepted it, passed it and ate it all. They pay for it.

AnnieCahill Posted 1 Dec 2011 , 10:35pm
post #9 of 31

Pyro, I have to respectfully disagree with you.

Not many people will make a scene at their event when there is so much going on. We see this happen all the time in this forum with weddings. People say "well they didn't say anything when it was delivered." Of course they didn't. It was their wedding day and there were more important things going on. Most people are not going to say anything until after the fact, when the smoke clears.

Depending on the situation, 15 minutes may or may not have been a big deal. Did they have a big dessert buffet waiting with empty plates? Was it supposed to be a surprise for someone? Depending on the situation, it may have caused the customer some embarrassment.

It all comes down to what was in your contract. What I would do is be very apologetic and say I will knock x percent off the cost of your order, and maybe give them a voucher for something for their next order. I'm sure they would appreciate that.

bakingpw Posted 1 Dec 2011 , 11:44pm
post #10 of 31

Yes, to always having a contract with refund policy and Yes, to getting a deposit and payment at delivery (if not before). However, I do have a couple of questions: you said you were only 15 minutes late but then you said the first wave was 30 minutes late and the second a 1/2 hour after that (1 hour). If it was 30 minutes and an hour, my question is: how long was the event? If it was a 2 hour event, being an hour late with the second wave of treats could have been too late. Also, were the treats you made on the second time around, after something happened to them, the same that were ordered by your customer or did you make some substitutions due to the timing?

I'm not saying they should not pay at all (in fact, I guess they are trying to settle paying for "food cost"), but it does seem they may be due some type of discount depending on the answers.

jason_kraft Posted 1 Dec 2011 , 11:51pm
post #11 of 31

I would give them a discount corresponding to the length of the event. If it was a 2 hour event, the first wave was 25% into the event and the second wave was halfway through it, so a ~37.5% discount would be appropriate.

esq1031 Posted 2 Dec 2011 , 12:53am
post #12 of 31

Pyro, I tend to agree with you, however it does depend on whether there was a contract or not and what those terms were. Also my opinion might change depending on what type of an event it was and how long that event was to have lasted. That being said, if the fact that they were late did not have a severe impact on the event itself,(i.e. a ruined surprise) then I would just offer a nominal discount or free delivery. The organizer of the event could easily have turned you away or negotiated a price with you before accepting the items after they were remade. I think it is poor business practice on their end to try to stiff you. You did deliver the goods and they accepted. In the future I would always have a contract and now make sure there is a clause which deals with this very situation.

costumeczar Posted 2 Dec 2011 , 1:32am
post #13 of 31

Was there a contract?

xoxoemilyrae Posted 2 Dec 2011 , 5:09am
post #14 of 31

I think a 10-15% discount is in order, but that is it (and I'm even hesitant to offer that). The treats were still accepted, eaten, and enjoyed. If the treats were of inferior quality then I would understand not wanting to pay. But the customer still accepted and ate the treats. You don't then get to decide you don't want to pay. That is ridiculous.

It would really help to know if the OP had a (written) contract. The reason I am hesitant to offer the discount is because my contract states that if I am late due to unforeseeable circumstances than I hold no liability. Being late is sometimes just a fact of life. I guarantee the event was not ruined, esp seeing as how ALL of the treats were still consumed even after being late. So just tell your client:

Dear xxx,

Due to circumstances outside of my control, your original order was destroyed and had to be remade. Because of the inconvience, I would like to offer you a 15% discount off of your order. This brings your total to $XXX due on Dec. 5th by Noon.

Thank you for your understanding,

jgifford Posted 2 Dec 2011 , 2:07pm
post #15 of 31

Did you let the customer know you were going to be late?

QTCakes1 Posted 2 Dec 2011 , 2:31pm
post #16 of 31

What I am not understanding is if the agreement was payment upon delivery, is when you delivered, and they didn't hand you a check, why did you leave the desserts? I don't believe this is a true stoy. It makes no sense to what even what you have said.

CalhounsCakery Posted 2 Dec 2011 , 4:21pm
post #17 of 31

[quote="SweetpopTN"] Have you ever been dissatisfied at a restaurant for example and say, I don't feel like paying the full amount. Can you put together your cost for the meal and I'll pay that? quote]

Actually I have to say that if I was in a restaruant and my food wasn't up to standard or came 15 minutes after everyone elses, I would expect a discount, or even a free meal.

That being said, I'm not saying they shouldn't pay something, as this is a different situation. However, a discount is definatly in order. I can't believe the nerve of them thinking they shouldn't pay anything! That's just pathetic! But as the food was up to standard, and you did rectify the problem, they shouldn't be so stingy.

mariacakestoo Posted 2 Dec 2011 , 4:58pm
post #18 of 31

Contract?? Really need to know this. I'm betting not since that question is being ignored. If no contract, they don't owe you jack. Doesn't make it right, it just means you gave them advantage right from the start. And you will spend more in legal fees and headaches trying to recoup it. Lesson learned....?

Adevag Posted 2 Dec 2011 , 11:33pm
post #19 of 31

It's interesting how you went out of your way to make an exception for this customer (not saying it's recommended) and let them be late with payment, because you were being understanding and kind.

When you had your incident and ended up being late, this same customer is not understanding at all. Strange.

sorry, I don't have any business advice. Just an observation about people and their morals.

mommachris Posted 5 Dec 2011 , 2:52am
post #20 of 31

I'm still trying to figure out what treat can be ruined and then delivered only 30 minutes late.

What was the product?


AnnieCahill Posted 5 Dec 2011 , 11:31am
post #21 of 31

I wondered the same thing too.

I think the OP has left the building.

SweetpopTN Posted 5 Dec 2011 , 9:39pm
post #22 of 31

I'm sorry I didn't check for more replies this weekend.

It was a holiday party and I'm not sure how long the event lasted. The treats were assorted cookies, cakepops, whoopie pies, brownies. I was waiting for the cakepops to dry so they could be transported to the event.

The contract was technically the invoice. We do have in writing that they agree to the invoice price and the terms on the invoice was that payment was due on receipt. They also did have in writing that they would have a check ready for us upon receipt. Fortunately, this is all I need here in the great state of Texas.

Why did we leave without a check? We left because they wanted to speak with us with their discount options on payment after the event. Was that a bad idea on my part? Yes. When the customer is already frantic and upset that we were late, they're not in the mind to even discuss this matter. She definitely gave me an ear full before I left. Yes, we did tell them we were going to be a little late.

The first wave was actually dropped off by an employee so he could leave first and have some sweets there and that's why I was able to follow him 30 mins afterwards.

*sigh* I realize I made many mistakes here but again I've never had a problem before with payment and this is a well respected organization in town. I didn't anticipate having problems with them. Definitely a great lesson learned. I'll keep you updated.

QTCakes1 Posted 5 Dec 2011 , 10:53pm
post #23 of 31

Well then I apologize and I see you have a lesson learned, and others can learn from it as well. Mad or not, they should have gave you the money. And I'm sure you know, contracts spell out details. I would give them a 10% discount to keep good faith for the lateness, but not the entire order for free.

KoryAK Posted 5 Dec 2011 , 11:05pm
post #24 of 31

Since this is an organization and not just a person, can you just contact the accounting department? I make exceptions on payment due dates for companies/organizations as well because 1) sometimes the bill needs to crawl through the accounting process through no fault of theirs and 2) I know I will get my money eventually because they aren't going anywhere and there's a management hierarchy.

You were late. $hit happens. I'm with the people that say offer a 10% discount or waive the delivery fee and then stand firm and collect what's due. The only circumstance in which you'd be owed less is if you didn't deliver at all and we all know you worked your butt off to have them there in time. I'm sorry that wasn't appreciated by the customer.

jo3d33 Posted 6 Dec 2011 , 12:58am
post #25 of 31

I personally think if you do not have a contract, you do not have a leg to stand on. Take what they want to give you and take the loss. You are going to spend more time and effort trying to get the $ out of them than its worth. IF you have a contract (signed) then stick to the facts, keep emotions out of it. Offer a discount off the first batch of 15% and second of 30% - corresponding to the amount of time you were late. If you are new to the business, sometimes to avoid bad publicity you just need to suck it up and walk away. Not fun and very irritating but I bet you wont "make an exception" again. I feel really bad for you and I hope everything works out. Good luck!

KoryAK Posted 6 Dec 2011 , 3:10am
post #26 of 31

You don't need a contract for every single order you do (we only do them for wedding cakes). She provided the order, she deserves payment. Period. Even if she chooses not to give any compensation for being late, they still owe for the product they ordered and consumed. By the same logic you could say well there was no contract saying you'd be there by 5, therefore it's no big deal that it arrived at 6 (or whatever). They wanted her to hold up the end of their verbal agreement, they need to hold up theirs.

indydebi Posted 6 Dec 2011 , 1:09pm
post #27 of 31

First, I am sorry you are having to go thru all of this. The good part is you now have "experience" to help you set and instill your policies for future events and will most likely not waive deposits. I've dealt with organizations and businesses before and most of them want to pay the night-of or afterwards, but when push comes to shove, they CAN get a check ahead of time.

An earlier post makes a good point about being a grand total of an hour late. As a caterer, I know it's important that the buffet table look nice and plentiful, especially at the beginning. If only half of the foods are there, then it looks "skimpy and cheap", something a hostess does not want to see happen in front of her guests. I dont' knwo what kind of event it was, but let's say for something like a fundraiser, a skimpy table reflects really bad on the hosting organization, plus the DIS-organization of getting stuff put out at the last minute or an hour into the event can give a bad reflection and cost the organization some donation monies.

On a personal note, someome mentioned "was it a suprprise?" This happened to me. On my daughter's 16th birthday, we planned to pick her up from school in a limo with The Beatles "Today is your birthday!" blasting thru a boom box (yeah a boom box ... this was "back in the day"!). The limo driver was new and couldn't find our house. Hubby had to FINALLY go pick her up in my car, a little ford escort. You can imagine our disappointment in not being able to do this for our daughter. Her friends and a teacher were waiting with her to see the big surprised we promised her, only to see her dad pull up in an escort hatchback! icon_lol.gif The limo company owner was a personal friend. We were, of course, calling to find out where the limo was. He arrives in a 2nd limo (too late to pick up daughter). 1st driver finally arrives. She gets chewed out by owner. He gives us the limo free for the night.

While it's very hard to swallow, if it were me, I'd offer a full refund, with my sincerest apologies and tell them that since the items were good and enjoyed by the guests, that I hope they'd give me another opportunity to wow them with my usual good service on a future event.

Baker_Rose Posted 6 Dec 2011 , 2:10pm
post #28 of 31

Amen Deb!!! You always know what to say!!!

QTCakes1 Posted 6 Dec 2011 , 2:51pm
post #29 of 31

Ain't no way in hades I am giving an up an entire payment order for 15 mins. A limo that never showed up for any of what you were trying to accomplish is not the same as food 15 mins. late. I seriously doubt she will end up up out of business or bankruptcy court behind asking for her owed money.

indydebi Posted 6 Dec 2011 , 3:39pm
post #30 of 31
Originally Posted by QTCakes1

Ain't no way in hades I am giving an up an entire payment order for 15 mins. A limo that never showed up for any of what you were trying to accomplish is not the same as food 15 mins. late. I seriously doubt she will end up up out of business or bankruptcy court behind asking for her owed money.

Im under the impression it was much more than just 15 mins late.

The OP said:

Originally Posted by SweetpopTN

I was able to get them their sweets while their event was still going so we didn't miss the event but we were 15 minutes late to the start of their event. I had to deliver the treats in two waves because we wanted to insure we could get them something as soon as we could. The first wave was 30 minutes late and the 2nd was 30 mins after that.

My math works the same as bakingpw in this quote:

Originally Posted by bakingpw

However, I do have a couple of questions: you said you were only 15 minutes late but then you said the first wave was 30 minutes late and the second a 1/2 hour after that (1 hour).

We got a limo eventually. The guests got their food/sweets eventually. Both were late. Both were utilized. Both were disappointing in the presentation by being late.

Whether the OP offers a discount on future orders or a partial discount on the current situation is up to her and what she feels is best for her business, and she is getting many good suggestions to choose from. If it was only 15 mins late, I might have a different opinion. I just feel the out of pocket costs I might incur on such a situation is minimal compared to the type of PR I might get out of the situation. good or bad.

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