Late payment or non-payment is adversely effecting commercial businesses up and down the country but one particularly alarming trends lies in the number of businesses having to write off turnover as ‘uncollectable’.
Most coverage within the media makes the assumption that businesses receive their outstanding monies in the end but unfortunately that just isn’t the case. Many businesses receive absolutely nothing on a more than regular basis.
Non-payment can occur for a number of reasons but by engaging with a professional debt collection agency like Cobra Financial Solutions can help to reduce the likelihood. To make life easier for you, we’ve put together four tips to help you avoid what must be considered a last resort.
Debtor insolvency is a common cause of non-payment and the importance of knowing your customer before offering credit terms has never been so important. Credit checks offer a valuable way to gain an accurate picture of your customers before you offer them credit and so remember to do this with any new customer. It is also advisable to regularly run checks on your customers as their financial circumstances could change at any time.
Review your account opening form
Something that’s often overlooked in credit control best practice is a detailed account opening form. This is your first opportunity to get as much information about your new customer as possible that you can use to get an accurate credit report, as well as all of their contact information for the credit control process.
This will allow you to be as close to them as possible in the event they don’t pay within the agreed credit period, and serves the added bonus of preventing them from disappearing – which is another common issue. If you are struggling to get your client to pay, engage the help of a professional, persuasive and proven debt collection agency to recover the outstanding monies owed to you. Don’t leave it for the sake of hoping they’ll pay. As soon as their account goes overdue, get in touch for the most effective results.
Don’t forget your terms and conditions
Unresolved disputes can also lead to non-payment. Unfortunately, in many cases, a business may not even be aware of any dispute until beyond the agreed credit terms, regardless of whether it is genuine or not.
As debt collection specialists, Cobra Financial Solutions suggest two ways of avoiding this. First and foremost, they should appear in your terms and conditions of sale- it is important to stipulate that any disputes must be raised within a specified period of receiving the invoice.
The second is to make a courtesy call as soon as the latest invoice is sent across to your client. This is a great way to check that the amounts are correct and it also provides you with a prime opportunity to notify your client of your clause regarding disputes and reaffirm when payment is due.
Getting specialist support
When comparing the cost of outsourcing the collection of an unpaid invoice to the cost of writing off a bad debt, the cost is minimal. While some find it difficult to approach the subject of debt collection it really shouldn’t be a taboo subject in B2B circumstances.
It is very important in business not to let unpaid invoices grow too old or the collectable value of the invoice will decrease rapidly. Professional and proven debt collection agencies like Cobra Financial Solutions can assist in getting back what is rightfully yours.
The aim of getting an expert on to your outstanding debts as soon as possible is to bring swift, positive results while at the same time reduce the impact chasing older debts has on your internal credit control team. This means that you can focus on what matters the most- concentrating on the day to day running of your business and keeping your staff happy.
If you have a debt you are worried about or a client who consistently pays late, get in touch with Cobra Financial Solutions. With offices across the North and South of the UK we are able to help you get back what is rightfully yours, regardless of where you are based.