New customers are brilliant for your business – unless they fail to pay you. If you don’t check that your client can pay you the amount of credit you are giving them then legal action can be a long and expensive process.
This puts your cash flow under pressure, and you in turn may not be able to pay your suppliers. This is bad business practise and is often regarded as corporate social irresponsibility.
Get to know your customer before you issue them any credit. As a minimum you should know:
Before Providing the Goods or services make sure you have looked at:
After you have provided your goods / services make sure you:
Consider your suppliers – treat as you wish to be treated!
An example of a monthly cash flow plan is here:
1st Rent, storage and utility direct debits collected from client accounts
7th Eviction notices raised giving a further 5 working days for unpaid rent and overdue storage letters raised
14th Eviction notices expire, 2nd letter issued for unpaid storage
15th Telecom direct debits will be collected, any failed rent DD’s will be automatically represented
20th Disconnection notices issued, automatic disconnection for any accounts with rent outstanding
25th Telecoms disconnection notices expire, disconnections carried out
All unpaid accounts are passed to bailiffs for collection or lock outs instructed