What to do with Slow Payers.

Every company will suffer from slow payers from time to time. Usually this does not present a major issue and will be as a result of slight cash-flow issues from your customer.

Let’s face it, what company hasn’t ever had cash-flow issues?

However, if it happens regular with a number of clients, this can be a problem as it can easily affect your company’s cash-flow and that shouldn’t be acceptable.

Let’s look at the following example:

Your credit terms are 30 days and 10% of your clients don’t pay until day 90.

This affects your profit and you want it improved but you don’t want to lose the customers

What are your options?

• You go with the flow and don’t upset the applecart

• Your boss calls their boss

• You send a series of letters

• You threaten legal

• You instruct a solicitor

• You issue legal proceedings

• You instruct a Debt Collection Agency

I have been in the business for many years at GB Pimney in the UK. What do you think I would recommend?

You may be very surprised to hear that I would recommend the last option, instruct a Debt Collection Agency.

The reason for this is that a Debt Collection Agency is the most versatile option of all of them. I don’t believe that any of the legal options are correct options for a 90 day debt.

A series of letters getting tougher on every one, just gives your customer a bit of breathing space. You want action now.

Source a reputable agency that only charges a percentage of the fee (5% - 10%) when collected.

Make sure you see real testimonials from happy clients. Ensure the agency prides itself on ethical debt collection and not aggressive tactics.

Another important factor is to ensure that the Debt Collection Agency only calls the client by phone. Make sure you speak to the actual collector and just make it clear the call should be polite but firm and threaten no action. The presence of a 3rd party debt collection agency is usually enough to ensure at least a promise of payment in an acceptable time. Modern day debt collection is a sophisticated and professional business and bears no resemblance to the “old time” image of burly menacing men. I’m sure that type of debt collection still exists and if that’s what you are looking for, you’re reading the wrong article.

For more details contact: -

Url : http://www.gbpimney.co.uk/slow-payers-solution

Company Name: - GB Pimney

Author Name : - Gregg Jones

Email:- gregg@gbpimney.co.uk

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