Worried about chasing payments? Outsource debtor chasing!
Posted on 24th August 2020 at 12:22
Boost your cash flow: Reasons to outsource debtor chasing
After the Coronavirus lockdown, maintaining a healthy cash flow has never been more important for UK businesses. Here's why cash flow management is so critical, as well as some advice on how professionals can help you with customer debt recovery.
Why cash flow matters...
Cash flow is critical for many reasons, but there are 3 in particular you should know about.
You need available capital to pay your own debts and expenses.
Incoming cash allows you to restock your inventory and meet customer demand.
A well-managed cash flow can make your company more appealing to investors.
So, how do you ensure a good cash flow for your business? Well, there are a few things you can do, but the easiest place to start is chasing overdue payments.
The problem with late payments...
It only takes one overdue invoice to threaten your monthly cash flow.
If customers don't settle their invoices promptly, you might not have cash on hand to pay your bills.
When bills add up, it's tempting to take out more credit to cover the debts.
Within a few months, you're struggling to pay everything.
Sound familiar? Don't worry–it's easier to recover overdue payments than you think.
Late payment letters
When it comes to chasing debtors, such as customers, the first thing you should do is send a late payment letter.
Think of late payment letters as a request. You're reminding debtors that payment is overdue and you expect a quick settlement. While many people pay quickly after receiving a late payment letter, it's not always that simple. It could take multiple letters or telephone calls, and if you're a business owner, you might be worried about appearing:
In a difficult market, you want to preserve as many client relationships as possible. However, customers still need to pay you on time. So, if you're worried about chasing debts, you should outsource the job to professionals.
Reasons to outsource debtor chasing
Debt collection specialists take the stress out of debt recovery. Rather than chasing overdue invoices yourself, here are 3 reasons to outsource debt collection today.
Outsourcing debt recovery lets you focus on the hard work of running a business in a post-COVID world.
You're not in direct contact with the customer, so your relationship is unaffected.
Debt collection agencies can make your business seem more professional.
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