Late payments can have a major impact on business survival therefore it is crucial that an effective process is in place to tackle the problem before it gets out of hand.
As with any effective operation, preparation is the key and there is a lot that can be done to streamline your business debt recovery processes. The following tips outline the most important ways to ensure your business can take the steps necessary to recover debts efficiently.
Appoint someone to be responsible for chasing late payments
Every business needs someone with the right skills to be able to recover outstanding payments. Having one person deal with late paying customers means that the process will be streamlined and it will avoid cases where multiple people within an organisation are contacting clients and customers, which can lead to misunderstandings.
Make sure your terms and conditions are water tight
All contracts should be drawn up by a qualified person to ensure there are no loopholes that will allow a customer to wriggle out of their payment obligations. In any legal dispute, a signed contract will be your most effective defence.
Systemise your payment processes
With smaller businesses, it is easy to slip into as and when payment processes with inconsistency creeping in. If invoices are sent in a timely fashion each month then clients are less likely to miss payments. It might also prevent issues and misunderstandings about what to pay and when.