Working with new, start-up companies has its benefits as they are usually keen to impress new clients. You may be offered a good deal on products or services, your businesses reputation and social responsibility improve as you will be supporting local business.

They are unlikely to have worked with a lot of suppliers, meaning they will probably come back to you if you do a satisfactory job, they may also recommend you to their other customers too. What happens though, if the start-up you have worked with starts to fail, and cannot pay your invoice.

The British Business Bank have released figures showing that 30% of the £231.8 million worth of loans from the Government-backed start-up loans scheme was written off between September 2012 and June of this year. In total, 13719 – of the 39566 loans issued since the scheme began, are in default or have been written off by the British Business Bank.

What does this mean for your business, of course your options depend on what type of company owes you the money, (limited, sole trader etc.) but one sure way to protect yourself, when working with unfamiliar, new customers is to ask for a deposit.

Asking customers for a deposit may seem cheeky at first, but a 30-50% deposit may protect you in the long run. A deposit shows that a customer is serious and committed to the purchase, but in the event of failure it makes it easier for your business to cut your losses.

Commercial Domestic Investigations can offer your business a host of support when it comes to troublesome clients. Our credit reporting service means that you can confidently offer payment terms based on client’s payment history, giving you and your business another level of protection. If you want to discuss your requirements with us contact us on 08444 159200 or email