2026-07-02 · 6 min read

Should You Require a Deposit Before Starting Work?

Every unpaid invoice starts the same way: work delivered, money not. And most small businesses only think hard about payment after that point — chasing, reminding, escalating. A deposit flips the timeline. It moves part of the payment to the one moment you have maximum leverage: before you've done anything.

So why doesn't everyone require one? Because asking feels risky. New clients might balk. Established clients might be offended. Competitors might not ask. The fear is that a deposit costs you jobs — and that fear keeps a lot of businesses doing 100% of the work on 0% of the commitment. Let's take the question seriously instead of by gut.

When does asking for a deposit make sense?

A deposit earns its place whenever your downside is real if the client walks or stalls. That's most obviously true when:

• You spend money before you're paid. Materials, subcontractors, travel, software — if the job has hard costs up front, a deposit means the client funds them, not you.
• The work is custom. A half-built deck or a half-designed logo has no other buyer. When you can't resell the work, the deposit is your only hedge against a client who disappears mid-project.
• The client is new. You have no payment history to lean on. A deposit is the cheapest credit check there is: someone who won't commit a portion up front is telling you how the final invoice will go.
• Your calendar is the product. If booking the job means turning other work away, a deposit prices the slot — and filters out the "maybe" clients before they cost you a real one.

Will asking for a deposit scare off good clients?

Mostly it scares off the clients you should want scared off. A serious client understands that commitment flows both ways — they're reserving your time and expertise, and a deposit is how that reservation becomes real. In plenty of industries (contracting, events, custom goods), deposits are so normal that not asking can read as amateur.

The clients who push back hardest on a reasonable deposit tend to be the same ones who pay late, dispute line items, and go quiet at invoice time. Their objection isn't to the deposit — it's to being pinned down. That's information, and it's much cheaper to learn it before the work than after.

The honest caveat: a deposit can lose you a job when your competitors don't ask and the client has no way to tell you apart on trust. That's a real trade — but weigh what you're actually losing. A job you win by dropping the deposit is a job where all the risk sits with you. Winning more of those isn't obviously winning.

How much should you ask for — and how do you frame it?

There's no magic percentage, but the working range in most service businesses runs from a modest booking amount up to half the job. Where you land inside that range should track your exposure: heavier up-front costs and more custom work justify more up front. Milestone billing — a deposit, a mid-project payment, a balance on delivery — spreads the risk on longer jobs and keeps any single unpaid chunk survivable.

Framing matters as much as the number:

• Make it policy, not suspicion. "All projects are scheduled with a 30% deposit" lands completely differently than something that sounds invented for this client.
• Put it in writing before the work. Deposit amount, what it covers, when the balance is due, what happens if the job cancels. A deposit that lives only in a conversation protects no one.
• Tie it to something the client gets. A confirmed slot on the calendar, materials ordered, work beginning on a date. People pay reservations more readily than abstractions.
• Don't apologize for it. A deposit is a normal commercial term, and the more matter-of-factly it's presented, the more matter-of-factly it's accepted.

Where Collector fits

A deposit protects the front of the job — but the balance still comes due at the end, and that's where most of the money still sits. The client who paid 30% up front can still drag the other 70% for ninety days, and now the chase begins from a friendlier starting point but is a chase all the same.

That back half is what Collector handles: it follows up on every aging invoice in your name, on a calm, human cadence, so the balance gets a same-day nudge instead of drifting into next quarter. Deposits up front, steady follow-up on the rest — that's the full shape of getting paid. $0 upfront, 20% only on what it actually recovers, so protecting the back end of the job costs you nothing unless the money lands.