I want to share my experience in one insitutional and household client…
First, our individual client…he is a Makati yuppie, 22 years old, a bank employee and an MBA student from the other school (i.e., La Salle)…he brings in his laundry 3 times a week with an average of 6-7 kilos. He’s been around 5 months already and the worst nightmare with one of my staff happened..he accidentally dropped bleaching liquid on the Dansen long-sleeves Polo of the customer. It’s the staff’s fault and this is what we did:
Our policy is personal accountability.  - I have three employees, one boy helper and two wash/press girls - whoever is at fault, they will have to do these three-step procedure: (1) be apologetic, (2) explain to the customer what “really” happened (I encourage my staff to be honest) and (3) offer free laundry services to compensate the damage garment.

If # 3 is unacceptable, offer partial cash equivalent to half the price of the garment and the other part, free laundry services.

Why do I insist on the free laundry services, well obviously I don’t want to lose a regular client.  It’s a tactic to give us another chance.

And where do we get the partial cash payment?  It’s an open secret that our laundry staff (most of the times) get lose changes from the garment pockets of our clients.  Since it is clearly defined in our Job Order terms and condition policy that we are not responsible for any loose changes, I encourage my staff to save it (once they get it) so we can have the fund to settle this type of risk.

Our settlement: Paid him Php500 cash plus PhP300 worth of free laundry service.

Second is our institutional client…It’s a Health Spa…they bring in everyday at least 25-28 kgs a day…regular price at PhP27 per kilo but they asked for a discount, so we gave them 25/kg in excess of 20 kilos on cash basis.
I realized, having a corporate account is difficult. At first they pay cash, then after two weeks their payment gets delayed. And since you’re after the payment, you cannot cut off te services, soon you’ll find out, their bills got piled up..Then when they reach the one month delay, they dictate already the terms and condition, as if adding insult to injury…they would look and mention at your “shortcomings”…like wet towels delivered to them, laundried smelly towels, and gray colored sheets.
This is questionable because what we did to their towel is unprecedented. Their towels turned whiter because we already used bleaching chemicals without additional charge. Even the oils are removed because we don’t do shortcuts. We complete the cycle (i.e., pre-soak, soak, pre-wash, wash, pre-rinse, wash, rinse).
Later I learned from his former staff, the spa owner was just cost cutting, and bought a washing machine to do the spa’s own laundry.
I understand the business cycle…sometimes you’re up, sometimes you’re down…what’s off is they accuse you of things you didn’t do….you give your best then they give you false accusation just to cover up their own problem…what’s worse is they still have an outstanding balance….any suggestion?- mighty thor

As for the damaged item, what they did is right. Personal accountability gives the staff responsibility for his own actions.Regarding the institutional account, we really don’t have control over our clients if we don’t draft and sign a contract. However, you can ask an attorney to make a demand letter asking them to pay for their outstanding bill. Sometimes this could be effective.