For a business to survive, it needs to collect all the money that is owed to it. While there may be a few customers here and there who don’t pay their bills or struggle to keep up, it is still important to keep customers accountable. However, before you go the commercial litigation route, you will need to know how to identify accounts that are delinquent.
Organization Is Critical
You can’t determine if an account is delinquent unless you have a system of tracking your accounts. This may be done by entering all client information into a computer when they make a purchase or keeping a paper trail of all customer sales and when they have paid. If a client hasn’t made a payment within 30 days of a due date, you can start to take collection action.
How To Get Your Money
The first step is to gently remind your client that he or she is late on a payment. In some cases, a client may have simply forgotten or is waiting to get paid by a client of his or her own. Assuming that the money will be in your account in a day or two, there is no need to take action that would anger an otherwise good source of revenue. Remember, those who owe you money have a right to ask that the debt be verified before they send any money.
What If Your Clients Still Don’t Pay?
If you have identified a past due account, verified that you have contacted the right person and you still don’t have payment, it may be time for legal action. Contacting a debt collection lawyer at Chitiz Pathak LLP may be your best chance for getting the money that you are owed. This person will work on your behalf to get the past due balance in a timely manner.
Either you will get a check from your client or have the right to liquidate any collateral that may have been used to secure the purchase. Regardless of what happens, you can rest assured that you will collect as much as possible. In some cases, you may get your balance upfront while in others it may be necessary to reorganize the debt.
When an account is delinquent, it means that your business is losing money that it deserves to have in its bank account. That money can be used to pay employees, acquire sponsorship rights or do other things that will help your company remain in business. Therefore, it is critical that you take whatever steps are necessary to get money from customers no matter how long it has been since services have been rendered.