Poor cashflow is one of the major issues that affect small business owners in Australia. A business that is operating well at every other level can be adversely affected and even face liquidation or closing down when debtors do not pay their invoices.
Putting into place some small business debt collection strategies will protect your cash flow and protect your business. The following are common mistakes made by small business owners in relation to accounts receivable:
Not Undertaking Credit Checks on New Clients
Credit with your firm should only be given after your clients have passed a credit check. Always get a personal and business credit report on your new clients. Our debt recovery lawyer in Sydney can assist you with this.
Ensure that you have adequate contact details for your clients. Obtain multiple phone numbers, ABN, multiple email addresses and their full street address as well as their postal address.
Not Implementing a Debt Collection Processes
One of the ways in which small businesses often fail is by not having adequate small business debt collection strategies in place. With the day to day work processes to complete, many firms state that there is simply not enough time in the day to chase up outstanding debts as well.
Businesses need to prioritize. If there are no funds coming in the door the business cannot operate successfully. If your internal staff does not have time for debt collection, we recommend you utilize the services of our debt recovery lawyer in Sydney.
Failing to Take Meticulous Notes
When liaising with your clients about outstanding debts, take meticulous notes. Make a note of any comments and payment dates that the client advises you of, follow up on these, and contact the client if they do not follow through with their promises.When taking further action with our debt recovery lawyer in Sydney it is beneficial to have a record of all emails and phone conversations regarding the outstanding debt.
Taking care of your business’s cash flow includes stringent strategies in small business debt collection, as well as managing your firm’s outgoing expenses. Taking the above into consideration will see the financial health of your business improve dramatically.