When a large company has used a small company for projects or to supply items over a long period, possibly years and has maintained a good payment record and so cultured a good business relationship, it might come as a shock for the small company to realise that their latest invoice has gone past its final payment date and still has not been cleared. In reality something must have taken place for the large company to default on the invoice and given the good business relationship that has been cultured the small company should as a first move speak with the large company and try and get to know what has taken place. The result of this contact might be good news in that a simple mistake might have occurred and might be repairable very soon, or it might be not so good, possibly the large company is havingcash flow issues and is delaying payments or possibly they simply use delaying tactics.

In the latter case the small company might feel that they are being treated rather callously and therefore feel confident in using Debt Collection to try and persuade the large company to pay their invoice. The difficulty for the small company comes in choosing which Debt Collection options are available and which they can afford to use. It might be that the small company is having cash flow issues itself and needs to have the direction that will be effective but low cost at the same time. Using legal practices or Debt Collection businesses, which is experienced in commercial Debt Collection and can supply a sample demand letter as an example of their services, can seem a bargain when they have “No win – No fee” deals, but the small company will have to be careful because the fee will typicallly be in addition to the debt that they charge the large company, who might not be too overjoyed about coming up with the extra. Where there are no deals of this kind the small company might well find themselves being obliged to pay 8% to 10% or more of the debt as the fee for Debt Collection services, as well as some costs up front for writing Debt Collection Letters possibly.

For a small company which is going through cash flow issues the use of Debt Collection Software can provide them with a long term solution, since once purchased the Debt Collection Software can be used for future Debt Collection projects, whereas legal practices or Debt Collection businesses would charge their fees all over again for each and every debt. The small company should evaluate Debt Collection Software systems carefully with particular attention being paid to Debt Collection Letters since these form the core of the Debt Collection activity and so need to be carefully created. To assist the small company in writing the Debt Collection Letters, the Debt Collection Softwareshould provide templates of Debt Collection Letters which take current legislation into account and the stage in the Debt Collection activity that they are targeted at. The small company will need to provide personnel to operate the Debt Collection Software and in order to produce good quality and effective Debt Collection Letters the personnel should have a good command of English, both spelling and grammar since any mistakes in Debt Collection Letters will reflect badly on the small company. With convincing and non-threatening Debt Collection Letters, the small company should be able to persuade the large company to pay the debt without harming the business relationship and both make the Debt Collection Software worth the money and to be able to look forward to future orders from the large company.

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