Top 10 Tips for Debt Control

20th July 2017
Top 10 Tips for Debt Control image

Top 10 Tips for Debt Control

1.         Check out your customer

Before conducting business with a customer get to know them to try and ensure that they will be credit worthy.

Collect evidence that your customer is who they say they are by getting copy utility bills or bank statements.  Carry out credit checks, and insist on a payment up front if the credit rating is poor or questionable.  Request trade references from their other suppliers, to see if they are paid promptly and in full.

2.         Provide your Terms and Conditions

A well drafted set of terms and conditions can protect you in case of late or non-payment.  You should ensure that the customer has these from the outset, and if possible get the customer to sign to acknowledge receipt and consent to them.

The terms and conditions should set out the maximum time allowed for payment (e.g. 30 days) together with a sanction for late payment (e.g. interest – include the rate also).

Occasionally a retention of title clause may prove handy, which states you retain ownership of the goods until paid for in full and that you retain the right to recover the goods if they do remain unpaid for.

3.         Make it easy for the customer to pay

Give the customer all the information that they need in order to pay, e.g. your bank account and sort code, purchase order number etc.  If possible have a variety of different payment methods available, such as direct bank transfer, card payment etc.

4.         Set a Credit Limit

Do not allow customers to build up large credit limits, bill them regularly and or insist upon a payment up front or on account.  Once you set a limit then stick to it, and don’t allow a customer anymore goods or services until your outstanding charges have been paid for.

In certain cases insist upon payment in full up front if for example you doubt the customer’s credit worthiness.

When dealing with limited companies it is also useful sometimes to obtain a personal guarantee for your fees from a director, so that he or she can be personally liable in the event of default by the company.

5.         Submit invoices regularly

Invoice your customers regularly, so credit is not allowed to build up and to ensure so far as possible that you get paid on time.

6.         Have a good Credit Control System

Keep track of invoices that are awaiting payment and those that have fallen overdue.  Send reminder letters, and or call the customer to ask for payment or an explanation of the delay.  Try to speak to the person responsible for actioning or authorising the payment, e.g. the accountant or financial director.  Make sure you call at suitable times, i.e. not lunchtimes or too late in the day, so you “catch” the person.  Monday mornings are often a good starting point!

7.         Resolve problems and deal with excuses

Occasionally the customer will have a genuine issue that will need resolving before payment will be made, such as the goods are faulty or they are not happy with a certain aspect of your service.  Try to resolve these as soon as possible to ensure that you get payment. 

Often customers will use delaying tactics (i.e. excuses) e.g. not received an invoice, have sent a cheque in the post etc.  Deal with excuses promptly, e.g. fax a copy of the invoice over to the customer and ring the customer to ensure receipt, ask for the cheque number and the date posted and check your post the following day.

8.         Keep full records

It is important to keep a full log of telephone calls, correspondence etc, to help you make decisions, how to proceed and possibly to use as evidence at a later stage.

9.         Stop the accounts

If payment is not forthcoming, stop providing the goods and or services until the account is brought up to date.  This will at least limit the sums that you are owed.

10.       If needs be take enforcement action and go to Court

Sending letters after letters demanding payment can be a wasted exercise, as the customer may think that this is just bluff.  If you have not been paid and you have given the customer a reasonable opportunity to pay then if needs be commence legal proceedings promptly to maximise the prospects of recovery.  Some times it may not be commercially appropriate to commence proceedings, and if you are in any doubt then speak to us!

If you do have any problems with customers relating to non-payment of your invoices, then please contact either Daven Naghen on 01775 722261 or daven.naghen@maplessolicitors.com or contact Gemma Mayer on 01775 722261 or gemma.mayer@maplessolicitors.com


Free Wills Month in October image

Free Wills Month in October

Maples are pleased to announce that they are taking part in Free Wills Month throughout October. If you are aged 55 or over you can make your Will for free and have the opportunity to help one or more of the sponsoring charities in the process. Appointments are limited in number and are allocated on a first come first served basis.

For further details please contact a member of our Wills and Probate Department:-

Jane Mawer- jane.mawer@maplessolicitors.com
Jamie Dobbs- jamie.dobbs@maplessolicitors.com
Faye Blair- faye.blair@maplessolcitors.com

Or telephone the office 01775 722261 and ask to speak with one of the team.

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Testimonials

Gemma Mayer LLB

"I would highly recommend Maples Solicitors, especially Gemma Mayer, for any conveyancing work. The level of support and professionalism was excellent at all times. I also felt if I needed to ask or clarify anything that it was not an issue. Buying and selling a house is stressful enough, but Gemma helped me through it step by step."

Anita Toal LLB BA

"I think you are brilliant. You can use my comments above. You are efficient, friendly and quite clearly very good at what you do. Mainly you don’t leave people hanging around too long for." "So easy to talk to her and she understood what I wanted. She put me at ease and I cant thank her enough"

James Turner BA

James Turner was extremely helpful with our buying process. Everything went smoothly. We are very happy with the level of professionalism demonstrated by the office. Highly recommended solicitors. Will definitely do business with them again.

Daven Naghen LLB

"Daven provided an excellent service, from attending the first interview with me to the final court appearance. He filled me full of confidence that he would defend me to which he did and come out with an excellent outcome in view of my position that I had put myself in."

Faye Blair LLB

Faye was excellent, sensitive and acted very well to the time constraints we faced. Great service and dealt with compassion at such sad times made the process less painful very professional.

Jamie Dobbs ACILEx

Over the last forty years I have cause to deal with many law firms both in a personal and professional capacity, including some ‘top’ London Companies. In all of those dealings I have never found anyone as proactive and so willing to offer help and advice as Jamie Dobbs. During the last two years Jamie guided my parents through the completion of Lasting Powers of Attorney. Helped myself with the use of the LPA and recently dealing with Probate and Estate Administration following their death.

Mike Pepper MA

Mike Pepper gave us excellent advice. He was always most helpful and accommodating giving lucid explanations every step of the way. Thank you Mike.

Donna Sandison FCILEx

Donna has been helpful and professional every step of the way during the process. Always on hand to answer any queries and totally professional and friendly at all times.