What Can Be Done To Get A Regular Late Paying Business To Change To Pay On Time?
posted in Used Car Donations |When a small organisation has done frequent work for a bigger organisation they may discover that they’ve less time to do work for other organisations and so may begin to rely on to some extent on this more massive organisation for their business security. In these still tight economic times, good clients are valuable and should be nurtured, but if they’re also frequent late payers, this can put a strain on the revenue of the small organisation. The small organisation could thus find themselves treading a fine line between persuading the bigger organisation to pay on time and losing them altogether and so making their organisation suffer, possibly to a massive extent. If the small organisation has not been in this situation in the past then they could need help on how to ideal manage this difficulty but the outgoings that could be incurred in the various routes may well be a deciding factor. Essentially there are three options for achieving the objective of keeping the client and getting paid on time in the future; a Debt collection bureau, a solicitor, or a DIY package comprising Debt collection software and Debt collection letters. The last choice isn’t only the cheapest but will also allow the small organisation to carry out the work in-house, which gives them control of the process, but does require resource to be allocated.
The key to keeping the client is surely to work with them in a professional, courteous and unemotional manner as this will not only be prone to be successful but will also put the small organisation in a good light as a professional enterprise. To achieve this, the Debt collection software has to be able to have Debt collection letters that meet the above needs and also stress the importance of prompt payment to the small organisation. Any decent package of Debt collection software will come with a user guidethat shows clearly how the Debt collection process works and worked examples would be so useful in making this clear, as well as showing how the Debt collection software itself works.
Since the Debt collection letters are at the core of the Debt collection process the small organisation will need to know that they have the tools to create suitable Debt collection letters, since it might well take more than one to reach a satisfactory conclusion. It would be ideal if such Debt collection letters were provided as either examples or templates in the Debt collection software, so that the small organisation can easily tailor them with details of the massive company and the debt. Superior still if these details can be input into the software and then automatically pulled in to each Debt collection letter it would be much easier.
There is legislation available to companies in the form of the “Late Payment of Commercial Debts (Interest) Act 2002”, which grants the small organisation, i.e. the creditor, to make a one off charge against the large organisation, i.e. the debtor, for an overdue payment, as well as this they can also charge interest on the outstanding debt. The creditor does not have to make these charges, but it would be a wise move to try and concur with the debtor that this should be part of a revised contract, so that both parties have agreed that payments will be made on time and there will be no need for a Debt collection process.