Debt Collection for Small Businesses
Debt Collection For Small Businesses
As a small business owner, it can be very frustrating and counterproductive to try and collect bad debts that clients and customers owe them.
After all, the productivity and livelihood of a small business depend entirely on its customers paying for the services they have received.
There is only so much your credit control team can do to ensure these result in collecting debts.
When a customer does not pay what they owe, this can affect the cash flow of the business.
You may think that taking legal action is the correct method, however, there are other ways to get unpaid invoices paid.
Handling these matters in a non-threatening or abusive way is vital, otherwise, your clients will never want to pay you what they owe.
Some of the main excuses for when customers don’t pay their debts are as follows:
- They are facing financial hardship and simply cannot afford to make payments.
- They are purposely not making their payments to avoid their financial responsibilities to you.
- They are unhappy with the goods/services supplied and have a legitimate dispute.
If you are lucky, then your clients are only facing short term financial hardship.
This means that they want to make their payments to you as per your payment terms.
Unpaid invoices can be prevented by ensuring all details are correct on the invoice i.e. registration numbers, addresses, names etc.
They may be in a situation where they don’t have the money so prompt payment is not an option.
The best way to approach this situation is to contact the client and try to work out a new payment plan or possibly a lower debt amount.
Most payment plans are 30 days or 60 days after services have been provided, which gives no excuse to not pay.
Regardless, make sure you document all your communication with clients.
All letters sent through the mail should be certified and copied, and all emails should be saved.
All this can be used as evidence in case you end up in a county court battle with them.
Be careful not to call a customer every day as this might come off as harassment.
Try contacting them every few days or so, whether it’s by email or phone.
Phone calls are probably better because it allows for direct real-time communication.
When a client hasn’t made any attempt to make payment over a long period of time, then you can proceed to a more drastic step beyond merely contacting them.
You can either hire a Professional Small Business Debt Collection Agency to pursue the debt on your company’s behalf or if appropriate, consider hiring a Lawyer to begin costly legal proceedings.
At Frontline Collections, we provide a FREE pre-action analysis and measure the debtor’s ability to pay.
How You Can Recover A Debt
Chasing payment when you have provided services or goods in good faith can be extremely stressful.
Small business owners often take it very personally when a customer does not pay and it is very understandable.
When you put your heart and soul into giving something to somebody else you expect to be paid back.
Unfortunately, there is a minority who lack respect and seek to take advantage of others.
Since 2005, Frontline Collections has provided small business debt collection services in the UK collecting millions owed to them.
Running a small business can be difficult enough and attracting custom is very most the forethought of every small business owner.
Knowing there is a professional and cost effective solution from the Best Debt Collection Agency in the UK will help.