Not being paid for work you have done?

You have done the work. You have paid the wages, suppliers, materials, fuel, plant and everything else it took to deliver the job. The invoice has been sent, the due date has passed, and the money still has not arrived.

It is rarely only about the money. It is the checking of the bank account before you have even had breakfast. It is wondering whether you should ring again today or leave it until tomorrow. It is the quiet worry that you should have seen this coming, or asked for something in writing, or said no when you had the chance.

I want to take that part off the table first. In almost every one of these situations I have sat in, the business owner did good work for somebody they had every reason to trust. The systems that got you here were built when the jobs were smaller and the money at stake was less, and the business has quietly outgrown them. That happens to capable operators all the time, usually without anybody noticing until a job like this one puts a spotlight on it.

So it is natural to focus on the invoice itself: send another reminder, make another call, and perhaps give it one more week. Sometimes that will be enough. Often it will not.

What can I do if a customer has not paid me for work I have finished?

An unpaid invoice can be the result of several very different situations. It might be an oversight or an internal approval delay. It might be a genuine dispute. The customer may be in financial difficulty. They may be using their position in the relationship to hold back payment. Or they may have a history of doing this to other businesses as well.

Those situations cannot all be handled in the same way. The first job is to understand which one you are actually dealing with, while making sure the exposure is not continuing to grow around it.

If there is an unpaid invoice in front of you right now.

If you rang me this afternoon, this is roughly where we would start. The answers tell us very quickly what sort of problem you are actually dealing with, and there are no wrong ones.

• Who, exactly, engaged you to do the work, and has the invoice been issued to the correct legal entity?
• What was quoted and agreed before the job started?
• Were your Terms of Trade accepted, and can you show how and when that happened?
• Were any changes or variations clearly documented and authorised?
• Has the customer raised a concern or dispute? If so, what is it, and when was it first raised?
• What was the last clear payment promise they made, and has that promise been kept?
• Are you still completing work, supplying materials or carrying further costs for them?
• Is there anything to suggest this is bigger than one delayed invoice?

Most people find they know more of this than they expected, and the gaps are usually the interesting part. Together the answers show the strength of your position, what sort of problem you are actually dealing with, and which options are genuinely still open.

If you are still working for the customer, be especially careful about allowing the amount owed to keep growing while you wait for an explanation. Before stopping work or supply, check your contractual and legal obligations and get advice where needed. But do not keep increasing the risk simply because nobody has made a deliberate decision about what happens next.

Five common reasons a customer does not pay.

Why do customers not pay their invoices?

In nearly a decade of sitting alongside business owners in exactly this position, the most useful thing I have learned is that not every unpaid account is the same. There are five broad situations I see again and again, and each one responds to something different.

They are the lifestyle debtor, who has done this to the business before yours and the one before that; the dispute, sometimes valid and often not; the unexpected, which nobody saw coming; the carrot, holding you to ransom for your own money; and the power imbalance, when they know you need the contract more than they need you.

Read more about the five types who do not pay, and what each one responds to.

What would worry me if this were sitting on my desk.

If you told me an invoice was 60 days overdue and the customer had stopped replying, my first concern would not be that you had failed to send enough reminders. I would want to know what else had changed, what the silence might be telling us, and whether your exposure was still growing while you waited.

I would look at who engaged you, whether they had the authority to do so, which legal entity owes the money, what your documents show, whether a dispute is beginning to form, whether payment promises have repeatedly moved, and whether there are signs that other suppliers may not be getting paid either.

I would also want to know whether you were still doing more work.

That is where good businesses can become badly exposed. The relationship has always been strong, so they keep the conversation informal. They accept another assurance because the customer has always come through before. They finish the next stage, order more materials or take on another job because they do not want to damage an important relationship. Meanwhile, the amount owed grows and their leverage becomes smaller.

Silence is not neutral. It may still turn out to be an internal oversight, but it can also point to cash-flow trouble, a dispute being built after the fact, a problem elsewhere in the contracting chain or deliberate avoidance. Sending the same reminder for the fifth time does not tell you which one it is.

You do not need to panic, and you do not need to begin with aggression. You do need to establish the facts, protect the evidence you have, stop drifting, and choose the next step deliberately.

What you can still control this week.

My customer will not pay. What do I do this week?

An unpaid invoice can make you feel as though all the control sits with the customer. It does not. Even when the final recovery outcome is uncertain, there are things you can still do now.

The aim is not simply to chase harder. It is to regain agency over your revenue and make the next transaction safer than this one.

Getting paid begins long before the invoice.

There are points in every customer relationship where your business can make a more informed decision, set a clearer boundary or reduce the amount of risk it carries.

When is it decided whether you get paid?

I call this the Transaction Journey. It begins with the first enquiry and moves through quoting, approval, customer onboarding, delivery, variations, invoicing, follow-up and final payment. Every step either strengthens your payment position or leaves something to be resolved later.

Strong trades and contracting businesses usually have well-developed systems for delivering excellent work. The payment side of the journey is often less visible. It has grown informally through trusted relationships, capable people and the way we have always done it. That can work extremely well, until a customer, contract or project sits outside the usual pattern.

And at the same time, we teach our customers how to treat us in business, just like in life. Both of those things are true at once. Underneath sits human behaviour - psychology, habits and practices - as well as the systems, infrastructure, automations, workflows and process a business runs on.

The commercial foundations that make payment more reliable.

Do terms of trade actually help if a customer will not pay?

Your Terms of Trade form part of the commercial foundation of the relationship. Well-drafted terms can clarify payment dates, deposits, variations, disputes, interest, collection costs, ownership and the remedies available if something goes wrong. But the document is only one part of the protection.

Terms sitting on a website or saved in a drawer do not automatically become part of every agreement. They need to be brought into the customer conversation at the right time and accepted as part of the transaction before work begins. If that process is weak, your business may not be able to rely on all the protections it thought it had.

This is the part I see missed most often, and it is usually not the document that is wrong. It is that nobody owns the moment where the terms are put in front of the customer.

General information, written from experience rather than as legal advice. Your own terms and contracts are worth checking against your particular situation.

Should I credit check a customer before I do the work?

You would not lend a stranger $50,000 in cash. But far too many New Zealand trades businesses will complete $50,000 worth of work or more for a client they have never credit checked.

And it does not matter whether it is $5,000, $50,000 or $500,000. It is all relative, and an unpaid invoice is still an unpaid invoice.

A credit check does not make the decision for you, and it cannot guarantee payment. It gives you information you can use to make a more deliberate decision, with the appropriate authority and lawful purpose. You may still choose to take on the work, but change the conditions: a larger deposit, a lower credit limit, shorter payment terms or staged payments before the exposure grows.

This is not about distrusting every customer. It is about knowing what decision you are making before your business supplies the money, labour and time.

Does asking for a deposit make it easier to get paid?

For larger jobs, a deposit and well-designed progress payments can reduce the gap between when your business carries the cost and when the cash arrives. The milestones need to be clear, practical and connected to the real cost profile of the work. A payment structure that looks tidy on paper but still leaves the business funding most of the labour and materials is not doing enough.

Deposits also establish payment as part of the commercial relationship from the beginning, rather than as an uncomfortable conversation left until the end.

What is a PPSR registration and does it protect me?

Where a business sells goods on credit, supplies them under retention-of-title terms, or leases or hires out certain equipment, the Personal Property Securities Register may help protect its financial interest.

Registering does not do the work on its own. It has to sit on top of a proper security agreement and be done correctly. But where it applies, it changes where you stand if a customer defaults or goes under, and that is a very different position to be in.

Most trades businesses in New Zealand have never heard of it. The ones who use it properly have a noticeably different experience when something goes wrong. It does not cover every service or every material that ends up built into somebody’s building, so it is worth checking whether it fits what you supply.

Read the official New Zealand PPSR guidance.

Who in my business should own getting paid?

Ownership belongs to a role, not to a person, and there are two reasons for that.

A role can be mapped. When the structure is built around roles rather than individuals, what that person did is written down, so when somebody moves on it transfers to whoever picks the role up.

In a small business or an owner-operated one, the same person often holds several of these roles at once. Naming the role lets you step into a different headspace and wear a different hat, so you know that when you are in this role, that is the mode you are in and that is your focus.

Getting paid on time is also an internal alignment question. Who completes the credit check? Who confirms the correct legal entity? Who sends the Terms of Trade and checks they have been accepted? Who approves a credit limit? Who documents a variation? Who issues the invoice, and how quickly? Who follows up, and what happens when a promise is broken or a customer goes quiet?

If the answer changes from one job or team member to the next, payment is being left to chance. Clear roles, handovers and escalation points are part of the business’s cash-flow infrastructure. They protect the customer relationship as well as the money, because everybody knows what has been agreed and what happens next.

The averages hide the real experience.

How late are New Zealand businesses actually paid?

When we talk about how late New Zealand businesses are paying, I think we need to be a little careful with averages.

Xero’s data tells us that, nationally, businesses are currently being paid around 24 days after invoicing, with payments averaging roughly 4 to 5 days beyond the actual due date.

But averages can skew the picture. They can make payment behaviour sound relatively benign when that is not necessarily what individual businesses are experiencing.

What I am hearing directly from businesses on the ground is much more nuanced. I have had established businesses, including some surprisingly large operators, tell me that customers who historically paid reliably are now taking considerably longer. Businesses that say they have never really experienced late or non-payment before are suddenly having to deal with it. And in some cases, businesses are regularly being held out to 60 or even 90 days.

There is also a behavioural shift that business owners talk about repeatedly. The 20th of the month becomes the end of the month. The end of the month becomes the beginning of the following month. And before long, what was once considered late starts becoming normalised.

That lived experience matters. It does not conflict with Xero’s data. It helps us understand what an average cannot show us.

If an invoice is due on the 20th of the following month, the business has already been carrying that cost for weeks before the invoice is even overdue. So if it then gets paid a handful of days after that due date, that is not just a few days from doing the work. It may be 30, 45, 60 days or more from when the cost was first incurred. In the businesses we work with, the 20th of the following month often stretches well past that once you add the time it takes to get the invoice out.

And averages hide the outliers. The invoices sitting 30, 60 or 90 days overdue get balanced out by the ones paid quickly, and the average lands somewhere in the middle, describing nobody.

The business owner does not experience an average.

They experience the actual invoice that has not been paid. The actual wages that still need to go out. The actual supplier account that needs to be settled. The actual overdraft being used. The actual tax bill that is coming up. The actual stress of not knowing when the money will land.

Across New Zealand, Xero estimated that late payments cost Kiwi small businesses $827 million in 2023, up from an estimated $456 million in 2021. That is cash sitting outside businesses that had already done the work, carried the costs, paid the wages and sent the invoice.

For trades, contractors and other blue-collar businesses, that gap is especially expensive. Wages, materials, plant, fuel, equipment and subcontractors are paid long before the customer pays the invoice. Every additional day is more of your own working capital funding somebody else’s operation.

So I think the more useful question is not simply how many days late the average New Zealand invoice is. It is what is happening to payment behaviour inside real businesses, and how much exposure they are carrying while they wait. The data gives us one part of that picture. What businesses themselves are reporting gives us another.

And right now, I am hearing from more businesses that payment is stretching, previously reliable customers are becoming slower, and some operators are encountering serious late-payment behaviour that they simply have not had to manage before.

If you have read this far with a particular invoice in mind, you probably already know which of the five situations you are in. The useful question now is what you want to do about it, and you do not have to work that out on your own.