Advice on Collecting Unpaid Invoices in Your Business
One difficult aspect of running a small business is the collection of past due invoices. Some entrepreneurs find this part very uneasy but it is really necessary if you want to survive in the long run.
The first thing you need to do is keep your cool and do not resort to any form of verbal or written harassment. Assume that it must have slipped their minds and it is your duty to remind them. In case you are facing this situation now, here’s what you can do:
The Ring
Make phone calls to your delinquent customers to remind them of their past due payments and politely ask them to settle it immediately. This is also your opportunity to determine the circumstances involved why that customer failed to pay on time. If they cannot pay in full, it is better to come up with an installment payment scheme instead of getting nothing.
Unleash Hell
If a customer is not yet willing to pay his debts after several calls from you, it is time to take a stand and claim what is rightfully yours. You can contact your legal counsel or refer this matter to a collection agency. You must act quickly; otherwise you will have to write off that debt as an expense.
Ask for Upfront Payment
In case you still don’t have the wherewithal to confront your delinquent customers, it is better to take a more proactive approach by asking your customers for a deposit upfront or a staggered payment based on milestones. However, always check the prevailing business practices in your industry to check if this acceptable.
Via BizInformer
