Commercial Debt Recovery
  Commercial Debt
 

Commercial Debt 

 



Businesses often have a significant amount of commercial debt that they need to manage collecting in order to improve on both their profitability (by avoiding write-offs of bad debt) and their cash flows. There are several steps that companies can take to improve on their collection of commercial debt which will be outlined here.
 
Using a Professional Debt Collector
 
Having an internal or external person dedicated to the process of collecting debt can be a real game changer when it comes to debt collection. An internal resource will monitor the outstanding debt, help prevent to extend debt to individual companies or individuals who are unlikely to pay, and follow up regularly an effectively with them. External debt collection firms are effective in not marginalizing your customer and in employing more drastic measures such as threats of legal action to improve on the collection process. 
 
Building Debt Collection into our Sales Agreements and Compensation
 
Contracts with clients and customers should clearly specify the payment due dates of all outstanding debt so that there is no disagreement regarding its ultimate collection. Clear and reasonable terms are one of the best ways to have the customers ultimately pay for the services or products that they acquire. Before accepting new clients be sure to perform a credit check on them to make sure that they are worthy of extending credit to them. An initial credit check and verification process can cost you some sales but dramatically decrease the risk that you will be unable to collect on old debt. Further, sales commission plans with employees that pays them when you collect from customers to help them to avoid being incentives to sell to poor debt payers or risky accounts. In addition, a sales commission that is paid when receivables are collected gets the salesmen involved in collecting and reduces bad debt write-offs.

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