No matter how much research you do into a customer or company, there is always a risk that they won’t pay their bills. Even trusted, long-term clients can surprise you and leave you in the lurch. It is an all-too-common situation and can be financially devastating.
When it occurs, you can do one of three things: cut your losses and write off the bill, ceasing trading with the customer, collect the debt yourself, or hire a debt recovery agency. Sometimes it is hard to tell if you need the third option. Many people worry a debt recovery firm will be too expensive. Or they fear losing control of the process. Here are some signs that show you the time is right to call in the experts.
- Your Customer or Client has Disappeared
You had a great relationship with a company while you were working with them, with plenty of contact on the phone and by email. Now, when your bill is long past due, they seem to have disappeared from the face of the earth. Your calls are unanswered. Mail is returned. You cannot get a response from email. You may even have visited their business premises and found them empty. Debt recovery agencies have the skills and powerful techniques to track down lost clients. They will find your debtors so you can claim the money you are owed.
- The Debt is Past Due
It is a good idea to work with a debt recovery firm as soon as possible since it is harder to reclaim money the longer it is owed. But sometimes debts can mount up. Call in a debt recovery firm if a debt is over 90 days overdue. It is tricky to claim the money after this amount of time, but a professional firm will have a much better chance of success than your in-house team.
- Cheques Have Bounced and Payments Been Refused
Customers that promise to pay and send in a cheque that bounces are due a call from debt collectors. This is a strong sign that the customer does not intend to pay their bill.
- They Avoid Communication
If the person you need to speak to about a debt is always in a meeting, or the manager promises to call you back and then never does, it is a good idea to hire a professional collection firm. You do not have time to waste calling and emailing, only to get nothing in response. They are trying to stall you in the hope you will give up and go away. They probably have no intention of paying.
- Payment Plans are not Respected
You speak to a customer who explains they are having financial difficulties, so you arrange a payment plan. Maybe they pay a couple of instalments, but then you receive nothing more. These customers are playing for time, trying to keep the bill unpaid for as long as possible so it is harder to collect. It’s time to work with an agency to make sure you get the money you are owed.