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Good morning,
its really important to have a clear strategy on how you will manage your debtors… far too many businesses do not have a credit policy – it doesn’t need to be a huge document, but sit down and think about what you expect from your debtors… do you ask them to sign terms and conditions that will protect you from a debt collection perspective?, do you assign a credit limit that they must trade within? when do you stop work/supply for non payment? If they have a claim or dispute – how will you handle that? When will you send a reminder (would recommend a day or two before it is due) and then when do you follow up on over due accounts? (would recommend 2 days past due). When will you go legal? Or for what $ figure would you go the default process?

If you have a clear understanding on what your requirements are, you will not be caught out by a debtor asking for you to continue work/supply when they are 6 weeks overdue for example, you may have already decided that you wont continue once they are 2 weeks past due, and can blame company policy for not incurring more debt from a non payer… you wont hang up the phone wishing you had said something different as you have already decided on your course of action.

If you would like to chat further for some free tips, please don’t hesitate to email me on [email protected]