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It’s important to develop a set routine, such as the one below, when collecting overdue payments for your Limited Company.
A typical debt collection policy:
• Invoice at the earliest opportunity, stating the payment terms clearly on the invoice.
• 15 days after invoicing, telephone the customer. Thank them for their business and ask if they are satisfied with your work or product.
• If no payment has been received after 31 days, send a reminder and call the customer to inform them that you are initiating collection efforts.
• Telephone the customer every two or three days. Bad debtors rely on the negligence of their creditors. Continual calling will let them know you are aware of the debt and show them that you are willing to take action.
• If there is a query or payment problem, arrange a new settlement date by telephone. Confirm this date in writing and state clearly that if payment is not made by this date, the matter will be referred to either a debt collection agency, a firm of solicitors, or the county small claims department.
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