Running a successful small business requires a healthy cash flow. So, when a customer accounts receivable past due begin to pile up, it's not something to be lightly dismissed. Bills arrears can seriously compromise business access to working capital and ended up putting the entire business in jeopardy.
But when it comes to the debt collection process, small businesses generally disadvantaged compared with their counterparts larger companies that have the resources to employ a dedicated, well-trained debt collection departments. You can get your free consultation today for any inquiries about debt collection organization.
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Here is a brief guide to the small business debt collection process that will both help to explain various aspects of debt collection at home and offer some tips and strategies.
1. Record customer information accurately and clearly.
Maintain clear, accurate, and up-to-date credit and payment history file on each of your customers is a must. To assist in the process, business owners should use accounting software programs are good, such as QuickBooks. There are also some good open-source options that can be used free of charge, the Microsoft Office Accounting Express, TurboCASH, and GnuCash.
2. Develop credit terms and conditions thoroughly and clearly.
Clearly states the terms and conditions customers must comply with to receive credit from your company. Included in this written document must be an overview of the actions to be taken when the account is seriously overdue.
Ensure that a copy of this policy is given to your customers when they establish a credit account and sent back in the case of bill arrears.