Clients are the most important part of any business, no matter what size it is and so it may seem odd to put your clients on stop and not supply your customers with a product/service.
Whilst ending a relationship with a customer may seem drastic, implementing a stop list can be the step that puts you back on track to a healthy cashflow. Once a business is on stop, they should be informed and no further products or services should be provided. Once the outstanding amount has been cleared it is best to request payment upfront or a deposit to be made when carrying out any future sales.
There are a few benefits for your businesses finances by using a stop list for late payers.
Prevent late payment
By placing repeat offenders on stop, it eliminates the chances of late payment from them in the future. If the client values your service or product, then the will have no option to adhere to your terms.
Save time and resources
If you choose to chase payments internally, it can eat into a lot of the resources that you have and it can be a very time consuming. Placing the persistently bad payers onto stop means that you no longer have to constantly chase them.
As soon as an invoice exceeds its payment terms it starts to negatively impact on your cashflow. Without money coming in, you may struggle to pay your own suppliers and invoices. Taking a tougher position on late payments can protect your business.
Chasing the same companies and listening to the same excuses can take its toll, even for the most experienced credit controllers. Having these debtors on stop gives your employees time to deal with payments that they may be able to collect. They will feel the benefit from not having to deal with client’s excuses daily.
If you are having issues with bad debt and not sure what you can do, our friendly team are on hand. At Commercial Domestic Investigations, we are highly trained in best practice and procedure and we recognise that every debt is different. Call us on 08444 159200 or email firstname.lastname@example.org.