All businesses encounter late payments at some point, that’s just an unfortunate truth. How you deal with a late payment however, is up to you. Employing procedures and following best practice before the payment is overdue is the best way to avoid a late payment.
Before the payment is due
From the beginning, a business should get to know their customer. Completing a credit check on your clients can give you valuable information about their payment history.
You should be upfront about your payment terms, don’t be scared of speaking about payments. Honest communication is an important part of business, especially when it comes to building relationships with clients.
When payment is due
Sending through an invoice when a payment is due is not enough. Contact the customer or their finance team directly to ensure that they received the invoice and all of the information was correct. Getting a verbal acknowledgement that the invoice has been received makes it harder for them to avoid payment. Build a relationship with the member of the finance team that approves invoices and payments, this will allow any potential issues to be resolved quickly.
When payment is late
Despite your best efforts, a payment has not been made by the client. Try to understand why the payment is late, are they now disputing the invoice, are they struggling with their own finances or have they just forgotten?
Whatever the reason is, try to sort the problem in-house, can you offer a payment plan to the customer to try and recover some of the money? Consider using a third party to mediate the situation, a good collection agency will work diligently to get the best solution for you and it allows your finance team to focus on other tasks.
At Commercial Domestic Investigations we understand how important open and honest communication is, with clients, suppliers and colleagues. It allows all parties to be truthful about their experiences and helps to build trust. Following procedures can help you to avoid late payments and means that every case can be dealt with professionally and efficiently.
If you want to find out more about how Commercial Domestic Investigations can help you with late payments, contact us on 08444 159200 or email firstname.lastname@example.org.