Business Customer Not Paid?
Business Customer Not Paid
Leading and running a business can be difficult enough. This is even without the issue of a Business Customer that has not paid.
For most companies in the world, the primary source of income is from sales.
Invoice payments from all of your business customers should be honoured. After all, you have provided clients with your goods and services. It is only right that you be paid for them.
However, some business customers will go out of their way to avoid paying what they owe.
Regardless of your industry sector, many companies and businesses of all sizes have to deal with this issue regularly.
Resolving issues with problematic non-paying customers is something that all businesses face.
Business Customer Not Paid – Resolving Payment Issues
No matter the industry, the sales and payment process for the client should be:
All payment terms and conditions should be discussed at the beginning of any agreement.
These terms should outline exactly what the client’s obligations are with regards to payment.
This way, the business customer knows (and must agree to) these terms before any work commences.
This process is made easier if you have a robust and effective credit-control process in place.
This can help to deal with any non-payments of invoices that could cause issues.
Despite robust payment terms and how rigorous your credit-control is…
…the actual act of payment relies entirely on your business customer.
Unfortunately, some problematic clients will go to the ends of the Earth to avoid paying an invoice.
Knowing the warning signs of a client who isn’t going to pay is important.
If despite your best efforts it appears like a payment will not be forthcoming, it is time to consider the available options.
It is common for many business owners to become frustrated in situations like this. This is completely understandable, and it is a sad fact that not everybody has the same ethics as you.
Some business customers will deliberately wait until the very last possible second to pay you.
Others will either try to evade you or just simply ignore all communications in an attempt not to pay.
If you are facing a difficult Business Customer who has not paid despite your best efforts, it is time to take some form of action.
Business Customer Not Paid? Send a 7-day Payment request letter
If you have reached this point and are considering options, it is likely that your goodwill has been exhausted.
By now you may have already attempted to make contact with the client. Typically, this will be done through phone calls, emails or maybe even by an SMS text.
Despite all frustrations, it is important to provide a final opportunity for them to pay.
No managing director wants a business customer that has not paid, so taking positive steps is always a good thing.
Retaining the moral high-ground and a professional stance is critical to success, in both this and all other matters.
At this point, your customer or client needs to be reminded of their obligation to pay you.
An effective way to do this is to issue a 7-day payment letter. This should be worded professionally, politely and firmly.
It should signal your intention to get them to pay.
Sometimes, people in business think they can simply ignore their dues and it will magically go away.
This should never happen.
The letter that you send should contain all relevant details pertaining to the amount due.
In it, you should state the original (agreed upon) payment terms. You should also state the amount you are owed, and that you intend to escalate the matter if payment is not made immediately.
In most cases, this will provoke a response from the business customer. They may contact you and advise what the issue with payment is.
Unfortunately, as you are already most likely aware of, some will not.
If they do not then it is time to seek professional commercial debt collection help.
7 Day Payment Request Letter Ignored
If your attempts to communicate with the debtor have so far been ignored, then it is time to consider your options.
If you have a business customer that has not paid without a valid reason, this needs to be acted on immediately.
Goodwill does not pay the bills, and no company needs business customers that do not pay.
A recent report outlined that 75% of Small to Medium Enterprises (SME’s) were unsure of taking debt collection action.
To many, instructing a debt collection agency is a last resort. However, in every case, it is the best way in which to recover an unpaid fee.
Waiting too long to contact a debt collection agency will only prolong the time and cost of the debt.
If your business customer has blatantly ignored your repeated payment requests, then instructing a debt collection agency is the right decision.
Business Customer Not Paid? Instruct a Debt Collection Agency
At Federal Management, we speak to business owners every day who have not been paid by their customers.
For every case, we provide a free pre-action assessment.
We can assess the situation, run financial checks on the debtors and establish their ability to pay.
Our initial consultation is completely free of charge and will provide you with a valid insight into the situation.
In addition, we can advise you on the best possible course of action and the options available.
We are also the only UK Debt Collection Agency to be regulated by the Financial Conduct Authority (FCA).
This means that our clients have peace of mind that we operate at the highest levels of professionalism.
Thousands of businesses fail every year due to not taking a pro-active stance on business non-payment.
If you have a Business Customer that has not paid, speak to our FCA regulated advice experts today for a friendly chat.
All enquiries are without obligation and we help thousands of businesses every year recover millions of pounds owed to them with our award-winning Business Debt Collection services.