New York Advertising Agency & Marketing Directory: Albany Buffalo Hudson Valley Long Island NYC Rochester Southern Tier Syracuse Utica Westchester
|
|
|||||
We have all had problems with our receivables at one time or another. None of us are exempt from a non-paying customer. However, there are measures that can be taken to “tighten” things up in the management of your receivables. Here are a few things that you can do to reduce the risk of delinquency and/or default of payment. Have a signed contract in place with your customer that provides the details of your agreement with them. Include payment terms and the consequence of delinquency, which includes late fees, collection costs and attorney’s fees in the event collection efforts or legal action becomes necessary. Always provide your client with a copy of this contract. Your attorney can create a contract that provides the best protection for your particular business. If cost is an issue, contracts can be purchased at office supply stores and on the web. A general contract can then be revised for your specific needs. For example; visit LawDepot.com. This site provides a tool to easily create a custom contract online to meet your requirements. However, it is in your best interest to have your attorney review your contract. Remember this document protects your business. When you begin the relationship with your client make sure to ask for a current address, phone number, place of employment and business phone number and cell phone number. Depending on your type of business i.e. medical, dental, legal services it may also be appropriate to ask for social security number and date of birth. Update your customer’s records regularly by making note of job changes, address changes etc. Make note of a change in payment pattern and ask your customer if there is anything that you can do to help them manage their account like setting up a payment plan. If you accept credit cards, remind them of that. Whenever you make payment arrangements with your customers, always deal with dates and deadlines. Don’t leave open ended payment arrangements. If you leave open ended arrangements it gives your customer the feeling that you really don’t care when you get your payment. Tell them when their file will be forwarded for collection. This gives you more leverage. Don’t allow your receivables to go beyond 90-120 days past due. Once an account gets to this level, refer it to a collection agency. If you remembered to include collection costs in your contract, you’re likely covered for this service. The collection agency’s ability to collect your debt will be much greater because the account is still “fresh”. The longer you wait the harder it will be to collect for several reasons: your customer’s financial situation if poor will undoubtedly worsen in time, your customer may move or change phone numbers, file bankruptcy, go through a divorce and just plain not take you seriously because you’ve waited so long. When consulting with my clients, past-due receivables generally are regarded as a quiet burden that too often goes ignored for a variety of reasons. To conclude, I’d advise you to take action today and follow-up on those receivables with the same intent and vigor as you would with any new business. After all, it is money you’ve already earned. Jan Conte is the President of Your Collection Solution LLC, a professional debt collection agency. Email: info@yourcollectionsolution.com
|
