Debt Collection Tips and Strategies
Thursday, September 27th, 2018 | The Cash Flow Group | Comments Off on Debt Collection Tips and Strategies
Strategies For Improving Collection Rates – PROVEN!
1. Have a Written Credit Policy
Follow this policy on a consistent basis.
2. Know Your Customer
Is your customer an individual, a sole proprietor, a partnership, or a corporation? Businesses often use fictitious names and acronyms for their businesses. It is important to establish who has responsibility for the obligation.
3. Plan for Collection Problems Before They Happen.
Your credit agreement or application should provide for provisions for attorney’s fees. Interest at a high rate and late charges for a delinquent account is also provided. To recover attorney’s fees, courts need a written agreement. This needs to signed by an authorized representative.
4. Use Personal Guarantees
Use these guarantees especially when you are dealing with new companies. These companies may not have a credit history. They will try to escape personal liability be creating a corporate account.
5. Have a Detailed Credit Application
All the above, and more, should be now contained in a comprehensive credit application.
6. Obtain a Security Agreement
This agreement creates a lien on the equipment or merchandise. This is to protect you in the event of a default or bankruptcy filing.
7. Keep all Correspondence Between You and Your Customer
Get a hold of us at the Cash Flow Group with any questions or concerns. We are here to help!