Keep On Top of Debtor Delays
The natural response from a company during an economic downturn is to tighten the purse strings and focus on recvering their bad debt. However, for a large percentage of the country there is still a lot to be desired in the efforts of companies concerning debt recovery and a great deal of things that could be improved upon to increase cash flow.
Russell Jameson, Collections Manager at Federal Management, said:
“A company who puts in the relevant policies and procedures concerning debt recovery and credit control will find it much easier to stop bad debt from becoming aged and bad debtors that are overdue don’t suddenly become unrecoverable”
Given the state of the economy at the moment, it is indeed practical information as an ongoing debt can rapidly become uncollectable.
As the economic downturn continues to drag out there has been no great increase for the requirements of debt recovery agencies. Mr Jameson says that this is in no small part down to the fact that companies are softening towards their debtors.
“Companies nowadays are looking at the individual circumstances of a customer, at their finances and credit reports when determining if a a debt is worth persuing.”
On the basis of this, commercial debt collection is finding itself as the most popular type of debt being collected as companies are generally assumed to be able to clear their debts unless suffering serious financial hardship thus the debts are more likely to be chased.
Any company facing non payment of a debt should be vigorous and robust in their approach. Ensuring that a sale is not complete until the money is in the bank, that invoices are formatted correctly and sent to the correct person, and outstanding amounts are regularly chased are key to keeping on top of bad debt.