As a business owner, it's hard enough to try to make a profit and be successful without having to deal with customers that won't pay their bills on time or at all. If it gets to the point that you need a commercial debt recovery firm, then it often has gone too far, and you are unlikely to get your money back. There are ways you can entice your customers to pay on time. Here are some of them.
Offer a discount
Many businesses offer a small discount for customers who pay on time. For example, you may offer a discount of up to 5 percent for customers who pay on time. You could even make the discount bigger for customers who pay in advance or at time of sale. While this reduces the profit you make, it cuts down on the expense you might incur later, such as having to tap your line of credit or spending money on recovering past due payments.
Charge interest for late payments
Customers often pay first the bills that have the biggest financial penalty. If you are not charging interest or penalties for late fees, then you are getting paid after the companies that are. Charge interest and enforce the terms on the companies that aren't paying on time.
Institute collection proceedings
You may have a longtime customer that you like and be hesitant to try to collect, but that just lets you be taken advantage of. You must treat all customers the same and initiate collection proceedings at the same point, which is usually after 60 or 90 days of non-payment. A collection letter often will spur on a customer to pay, but if it doesn't, you need to pursue the issue all the way to court if necessary to get payment. Click on Commercial Debt Recovery for more details.
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