For business dealings, most firms automatically expect 30 days credit. In fact, if you don?t accord different conditions, the law says businesses can take thirty days to settle the invoice by default.
Larger companies will oftentimes demand 60 or 90 days to settle the invoice, or possibly even more. It can be a real problem on your cash flow to be waiting yet another week for money that?s justifiedly yours.
One thing you can execute to grow your cash flow is to be firm with all clients about your willingness to use a debt collection agency.
Initially, you need to be totally clear with clients about the conditions of the product or offer you supply, and the process you will follow if those terms and conditions are not respected.
You should get a solicitor to help you compose a contract that is most applicable for your business.
You can also cut your risk by running credit checks on new customers before you begin working with them. Have a set of standard letters that you send to customers when money is owed, telling them how much is due and the penalisation for not settling the invoice right away.
If you have followed this method and still not been paid,you should call in a debt collection agent such as Fisher Meredith.
Don?t be oblivious to the problem hoping the client will pay. Agencies say the older the debt becomes, the lower the odds of it being paid. You should work with an agency you feel at ease with.
The rewards of using a debt collector to continue chasing the debt are indisputable. They have the time and knowledge to focus on the recovery. A firm that knows what it?s doing will get a fast result. And if the customer cannot pay, they will examine the choices and take official legal action.
The only downside is the price ? typically up to ten per cent of the debt. But 90 per cent of an outstanding debt settled is better than a hundred per cent of the money still sitting in your client?s bank account!
