Getting Paid: Invoicing, Net Terms, and Collections for a Commercial Production Company

The video ships. The client loves it. The invoice goes out net 30. Day 45 arrives and the money hasn't. This is not a rare situation in commercial production, and it is not usually a sign the client is dishonest. It's a sign the production company didn't understand, going in, how payment actually moves once an agency or brand's own internal approval chain gets involved.

Delivering great work and getting paid for it are two separate skills. Most production companies are excellent at the first one and treat the second like an afterthought, something that happens automatically once the deliverable ships. It doesn't. It has to be built into the contract, the invoicing process, and the follow-up discipline from the start.

Why "Net 30" Rarely Means What It Sounds Like

Net 30 sounds like a simple, universal term: invoice today, paid in 30 days. In practice, who's actually paying determines how real that number is.

Direct-to-brand clients paying their own money, out of their own accounts payable process, tend to be the most reliable on stated terms. A brand with a functioning AP department that approved the project internally usually pays close to net 30 because there's no intermediary layer.

Agency clients introduce a structural delay that has nothing to do with intent. The agency itself is often not the party ultimately funding the invoice, its own client, the advertiser, is. Industry guidelines from AICP make this sequencing explicit: the advertiser is initially liable to the production company for payment, and the agency becomes liable to pay the production company only once it has actually received the funds from the advertiser. A production company invoicing an agency net 30 is often really waiting on the agency's own client to pay the agency first, then waiting for the agency to process its own payment run. Enterprise brand clients in the DFW market with layered internal approval chains commonly run 45 to 60 day accounts payable cycles even when the signed contract says net 30, not because anyone is acting in bad faith, but because that's how long the money actually takes to move through their own systems.

This isn't a reason to avoid agency work. It's a reason to price and staff around the real timeline instead of the stated one. A production company planning cash flow around a hard net 30 assumption on agency-sourced work is planning around a number that rarely holds.

The AICP Payment Structure, and Why It's Worth Copying Even Off Agency Jobs

AICP's National Guidelines for live action production lay out a standard payment cadence that splits payment across the life of the project rather than waiting for one lump sum at the end: a portion due at signing, a second payment, commonly around 25 percent of contract value, due on approval of dailies or within 30 days of the final invoice, whichever comes sooner, and cost-plus items (out-of-pocket expenses billed above the fixed fee) due within 30 days of invoice regardless of the rest of the schedule.

The structural insight worth borrowing, even for a small direct-to-brand project with no agency involved, is that payment shouldn't be a single event at the very end of a project. Splitting payment into checkpoints tied to real milestones, signing, shoot completion, delivery, keeps cash moving during the project instead of concentrating all of the company's payment risk into a single invoice sent after everything is already finished and delivered. GLM's own internal pricing structure follows this logic directly: 50/50 (signing and delivery) for projects under $25,000, 30/40/30 (signing, shoot completion, delivery) for the $25,000 to $75,000 range, and 33/33/33 (kickoff, offline edit, final handoff) for larger engagements, with a 100 percent upfront option reserved for short-turnaround work or a new client with no payment history yet established.

What a Late Fee Clause Actually Needs to Say

A late fee is unenforceable unless it's written into the contract or the invoice terms before the work starts. A production company that tries to add a late fee after an invoice is already overdue has no contractual basis for it, no matter how reasonable the fee sounds.

The market-standard structure charges 1.5 percent per month, non-compounding, on the outstanding balance starting a set number of days past the due date. That works out to 18 percent a year, which is the de facto industry default for freelance and small-business service contracts. A written, agreed-upon contractual late fee is treated as a different legal category from non-contractual interest (some states cap that as low as 6 percent), but 18 percent a year also lands at or near the ceiling several states set for contractual interest, which is the practical reason to keep the rate at or below the 1.5 percent monthly default: push above it and the clause gets easier to challenge. The exact clause language matters less than making sure it exists in writing before the invoice goes out: something as simple as "a non-compounding late fee of 1.5% accrues monthly on any balance unpaid 30 days past the invoice due date" is enough to make the fee enforceable later if it's ever actually needed.

The Collections Ladder

Most overdue invoices resolve with a phone call, not a lawsuit, but it helps to have an escalation structure in mind rather than deciding in the moment how hard to push. A workable ladder looks like this:

Day 1-10 past due. A short, friendly email. Assume it's an oversight, not a dispute, because most of the time it is. Include the invoice again as an attachment; sometimes the delay is nothing more than a lost email.

Day 10-30 past due. A direct phone call to the actual accounts payable contact, not just the creative or producer contact who commissioned the work. The person who approved the project often has no visibility into whether the invoice has cleared AP, and a phone call to the right desk resolves more overdue invoices than another email ever will.

Day 30+ past due. The late fee clause activates if the contract includes one, and it should be invoked in writing, referencing the specific contract language. This is also the point to loop in whoever signed the contract on the production company's side directly with whoever signed on the client's side, rather than leaving it to junior staff on either end.

Day 90+ past due. Formal collections or attorney involvement becomes a real consideration. Most production companies never reach this stage with most clients, but having a stated point at which the relationship moves from "we'll work it out" to "this goes to collections" keeps a slow payer from becoming an indefinite one.

When to Ask for More Upfront

Payment terms aren't fixed by industry convention alone, they should flex based on how much is actually known about a given client. A new client with no payment history, no matter how prestigious the brand name, is a different risk profile than a client who has paid three prior invoices on time. It's reasonable, and increasingly standard practice, to require a larger deposit or even 100 percent upfront from a first-time client on a smaller project, and to only extend standard net-30 terms once a payment track record exists. This isn't distrust, it's the same logic a bank uses before extending credit: trust is earned with a track record, not assumed from a logo.

Invoice Factoring as a Cash Flow Bridge, Not a First Resort

For a production company carrying a real accounts receivable balance from slow-paying agency clients, invoice factoring is worth knowing about even if it's rarely the right first move. A factoring company purchases an outstanding invoice at a discount, typically advancing 80 to 90 percent of its value immediately and releasing the remainder, minus a service fee generally in the 2 to 5 percent range, once the client actually pays. It converts a receivable sitting on the books into working capital today instead of in 45 or 60 days.

Factoring makes the most sense as a targeted tool for a specific cash crunch, covering payroll during a stretch where several large invoices are all sitting in a slow agency's AP pipeline at once, rather than a standing financial strategy. Running the majority of receivables through a factor as a default habit means giving up 2 to 5 percent of revenue permanently to solve a timing problem that better contract terms, deposit structure, and collections discipline can usually solve for free.

The Real Fix Happens Before the Invoice Goes Out

Every tool described here, milestone-based payment structure, a written late fee clause, a collections ladder, upfront deposits from new clients, works best as prevention rather than cure. The moment to negotiate payment terms is during contract signing, not after an invoice is already 45 days overdue and the relationship is turning tense. A production company that treats "how and when do we get paid" as seriously as "what are we delivering and by when" during the initial scope conversation spends far less time chasing money later.

This is general information about common payment practices in commercial production, not legal or financial advice. Late fee enforceability, usury limits, and collections procedures vary by state and by the specific contract language in place; a Texas attorney should review payment terms language for any standing client contract or template.