If you are thinking of getting the money back from your debtors, then you have to be ready to handle a lot of stress as well as difficulties. When your client is refusing to pay you back, there can be two different reasons. One, they are in some real financial crisis which is preventing them to make the payment. Second, they are doing it on purpose, deliberately refusing you the payment. In any case, it is necessary that you plan a few strategies to get the money back and work on them.
When the debtor is failing to make the payment, it is obvious that you will panic. After all, no business owner can leave the money floating in the market for a long time. It will stall all the production in the company while making it difficult to pay the salary of the employees. In such a situation, you will be hiring a collection agency anyway. But while doing so, it is necessary that you think of following your own strategies too. Take a look at the following points to know more.
Develop a Credit Policy
The first and foremost thing that you need to do is develop a credit policy. Your company should have a definite policy that will save your company from any kind of defaulter in the future. It is necessary that you have such policies at the place. This will save you from further trouble as the companies you will get in touch with will know what they are getting into.
Keep Good Records
When you are getting in a business transaction with a new company, the most important thing that you need to keep in mind is that you must keep good records. Obviously, all your debtors will not refuse the money. But it is necessary as you should be prepared for all kind of situation so that if necessary, you can present all the documents when it is needed. The thorough documentation will also help you to keep a track of all your initiations for payment and settlements. In case, if you have to move to the court for commercial debt collection, you will need to present your documents there.
Be Assertive and Sensible
It is necessary that you think of being assertive in your approach. After all, you are asking for your own money. But that doesn’t mean that you will have no consideration whatsoever about the situation the debtor might be in. Maybe the debtor is filing for bankruptcy. Or maybe there is a partnership dispute which is taking a toll on the finances. Or maybe there is the issue of the sudden demise of a family member which is making it difficult to make the payment. Or worse, there is a case of property damage or arson. You hardly have any idea before you talk to them. Hence, it is necessary that you behave patiently and sensibly.
Don’t Stop Communication
Don’t stop communicating with the debtor. Make sure that you are always in touch with the debtor. Through regular phone calls, emails and letters, stay in touch. If you are finding it difficult to do these, you can always hire trusted credit collection services, which will do the following up on your behalf while maintaining the complete documentation of the initiations.
So, now as you know about these abovementioned strategies, what are you waiting for? Follow them and get rid of bad debt now. If needed, hire an agency that has experience of dealing with such complex cases of debt collection.
Strategies you can follow if Your Debtor is failing to Pay You Back
