Merits of the Honor System
There are many reasons to have customers sign a contract for work. Regardless of what industry you are in, a good contract will protect both you and the customer. But what ever happened to the honor system? In a world where people are looking too rip everyone else off, it seems as though all trust has been lost. This is unfortunate as I believe that a honor system that functions well helps build respect between the client and contractor. In this article I will outline why the honor system still has merit.
Before I ran my web design business full time, I ran a property maintenance business. It was great; I got to drive a truck, worked hard for my pay, and go to play around with tools. However one of the main problems I ran into running a property maintenance business was that nobody wanted to sign a contract. They wanted to have options; they wanted to be able to cancel if they could not afford the service. They also did not want to have to pay for service they did not get. Many clients have gotten burned by contractors with contracts, people who basically take the clients’ money, do half a job and call it done. With the honor system, people feel like their being respected and trusted more, this is the key to all relationships, especially a business relationship. When you use the honor system, you are telling the customer that you have enough faith in them too pay the agreed cost to put in the hours to do good work.
Another merit of the honor system is that it you are likely to get more clients. Many people do not want to sign a contract. Contracts make many people uneasy, so many will choose not too work with someone who requires them. Contracts can potentially increase your “guaranteed income”, but the fact of the matter is, unless your are prepared to pay a pile of fees to collect on delinquent accounts, contracts do not guarantee much but a few less pieces of paper and a lower ink level. For a less “guaranteed income” but a higher amount of people signing up with me, in my mind, far outweighs the chance that someone might not pay once the work is done. I also regularly keep conversations for work I do, so that I can prove there was an agreed upon price.
There are many reasons to use both the honor system and a contract. Contracts can give you some security, and help protect everyone in the agreement. Honor system can build more trust and respect. Depending on what you’re needs and experiences are, you might choose to use one system or another. Both are legitimate and have their strengths and weaknesses.