Debt recovery is a difficult task to undertake, although some overdue accounts can be resolved with a simple telephone call to the client, not all accounts are that simple. You may need to take further action with these clients and refer their account to a debt recovery agency, but there is something that you could have used to support your debt recovery procedure before taking more final action – a contract. The use of a well constructed, clear contract is not only good business practice, but can be useful in the debt recovery process.
The best advice that we at Commercial Domestic Investigations can offer your business is to do your best to avoid bad payers. Comprehensive contracts can play a huge part in helping you to do this. The very mention of a contract may be enough to deter a bad payer. By signing a contract, they are entering into a legally binding commitment and many businesses, or individuals, will not agree to enter this agreement unless they are confident of their ability to pay. Be wary of clients that are reluctant to sign a contract, this may indicate that they are a problematic payer.
Get as much information about the business, or owner as possible. Having a clause in your contract, which asks the client to give you their details means that you can request a credit report to assess their payment history; this information can be useful in the future if problems arise. If your debtor is avoiding contact and it seems as if they have vanished, having these details makes it easier to run a trace and track them down.
Clearly define payment terms, how much is due and the timescales expected, along with any notice period of termination of services. This leads to less confusion for the client and less likelihood of customer disputes. It gives your business a reference point that proves the clients agreed to specific terms so they can’t avoid payment.
Contracts can increase the chances of being aid in a timely manner and gives you a reliable reference if the debt recovery process takes a legal route. A contract between yourself and the client makes the agreement binding, and it can be enough to persuade the client to pay their debts.
At Commercial Domestic Investigations, we have a range of services available to assist the debt recovery process, from credit reporting to trace authority. Our highly-trained team work tirelessly to recover your debt and conform to best practice. If you want to speak with someone about your debt recovery needs, contact us on 08444 159200 or email firstname.lastname@example.org.