Showing posts with label credit control advice. Show all posts
Showing posts with label credit control advice. Show all posts

Monday, 6 April 2020

Collecting Cash in a Crisis!

Collecting Cash in a Crisis - By Laura Ferrie

Whilst we are all trying to navigate our way through the situation created by the Covid-19 pandemic we wanted to offer some practical advice and give you the opportunity to take advantage of our many years’ of experience in this field. Some of us are choosing to up the yoga, meditation and mindfulness to survive the lockdown and others are upping the biscuit, crisp and wine intake to reach the same goal. Whichever category you fall into in addition to worrying about our health and the health of those we love there is another worry for us all … money.
Sadly I am old enough to have seen the impact of a number of recessions over the years and have the skills and knowledge to help clients come through this. At this point no one knows exactly what the financial impact of the pandemic will be on the global economy other than to know it will be damaging but there are small, pragmatic steps businesses can take to try to lessen the impact. So, as the dust begins to settle on what is the new normal for us all it is time to look at how, practically, we are going to get ourselves and as many others as possible through this; both in terms of our health and also financially.
These difficult times call for some inventive measures to collect cash outstanding to our businesses. The normal “See you in Court” response to a reluctant payer is not going to help much at the moment.
Process servers are unable to serve Statutory Demands in person either for winding up or bankruptcy (albeit that I am aware of a few companies that have been throwing the papers from two metres to the feet of the recipient). Good luck having something issued at the Courts, they, like the rest of us are on reduced staffing or closed. Obviously proceedings can be issued but there are significant delays in issuing proceedings. When, eventually, you get a judgment (I am discounting the debtors here who will deliberately enter a defence knowing that the Courts will not be able to deal with the matter for even longer than usual) how are you going to enforce the judgment when as of 27 March 2020 the major High Court Enforcement Officers are no longer attending debtor’s premises? It’s a case of “Can’t pay, we’ll stay away” at the moment.
With so much happening the news has not covered in detail all the measures taken by the government to keep the economy going. For example, were you aware that the wrongful trading laws have been relaxed in relation to directors, or that the law in relation company insolvency have been temporarily changed and softened? We are. It’s a part of our job to keep abreast of the changes in the law and to keep our clients appraised of the impact on them.
So, as demonstrated there are clear and obvious problems with the practicalities of attempting to use the legal process to recover money; the statutory tools useful for collecting money are simply not available to the creditor during the current crisis.
Then there is the moral issue. Does the creditor want to be seen as the “big bad wolf” hungrily knocking at the door of the debtor? I would venture to suggest that in these times most reasonable Finance Directors and Credit Control Managers would say not.
We are all seeing stories on the news about the impact on companies that are laying off staff, the effects on those staff and their families and even if we are not being directly impacted at the moment these situations are future worries for all of us at this time.
The Government is offering assistance to businesses of all shapes and sizes. Whatever political colour we may be there is no avoiding that the extension of time that the government is offering for payment of VAT, self-assessment liabilities, 12 month interest-free business loans as well as some grants are helpful and may provide a welcome lifeline.
The building societies, banks and credit card companies are offering payment holidays to its customers, again, many will find this welcome and helpful.
With so many measures in place to help anyone that is owing money should the business creditor sit on its hands and take no action with trade debts? Of course not.
What we are able to do is weed out the genuine “Can’t pays” which will undoubtedly increase from the “Won’t pays” who will definitely attempt to take advantage of the current position. My experience and that of my staff enables us to tell one group from the other. We will set up realistic and monitored payment plans for those in genuine need of time to pay and make sure that they adhere to them. We will put pressure on the other category to get your cash sooner.
It is an undeniable fact (and one that drives my current clients mad) that sometimes just the introduction of a third party will have the desired effect but in many other cases our tenacity, knowledge of the law and expertise along with decades of experience in our area all come into use and we can brings our customer’s cash in quickly.
My top tips for collecting overdues before getting to debt recovery stage would be:
  • Talk to your customers – Painfully obvious but it surprises me how many of my clients have no meaningful dialogue with their customers once they have become debtors
  • Credit check more than usual
  • Seek personal guarantees from limited company directors where you are not happy with the position of the company
  • Use the Land Registry to check if directors giving PGs own their property. https://eservices.landregistry.gov.uk/eservices/HomePageRouter
  • Monitor, monitor and monitor again (always good advice but more so at the moment)
My co-director and I have more than seventy years combined experience in credit management, debt collection and the law pertaining to debt and insolvency, we have the inventive measures necessary to assist your cash flow. In Spring and possibly Summer 2020 it is so important to try everything to collect your money without going to Court and we can help you do this, please give us a call on 01992 414222 or email me on laura.ferrie@creditserve.co.uk. We may just have the solution to your problem
Stay safe.

Monday, 7 July 2014

Top Tips for Credit Control and Debt Recovery

Good Practice

When carrying out good credit control, where is the line between being clear and being rude?  Well, after being a commercial debt collector for more years than I care to remember (or to put in black in and white!) in my view there is no place for the latter and every need for the former.

In my experience though many debtors perceive clarity as rudeness, perhaps because they are feeling defensive?  However, effective credit control is all about clear, unambiguous communication both verbally and in writing.

Part of the secret to getting paid on time is to be explicit with your customers about what you want and what, if they have signed your terms and conditions, they have contracted to.

When you first open an account, advise the new customer what their credit limit is and when their payments must be made by.  Also tell them what the sanction will be if they don't adhere to your terms.  Will they have to pay late payment interest, or go on stop?   Will you pass the account out to a commercial debt recovery agency? Will you, ultimately, take legal action?  

Make sure that your invoice has arrived with your customer, "Hi it's George from George & Sons, just checking that you have got our invoice and that it is being processed for payment by the thirtieth? You have? Great. Have a good weekend, are you going to watch the game?" Suddenly credit control does not have to be hostile, it can be used as an opportunity to build and enhance relationships with your customers.

Creditserve Collections is a good debt recovery agency, I think, one of the best.  But by the time you have to pass a debt out for collection, even to the best agency, you will have missed so many opportunities to get paid.  Don't wait until a customer is late paying you before you contact them.

So be clear, be proactive and if all else fails ring Creditserve Collections on 01992 414222 for expert debt recovery, credit control out-sourcing and credit control advice.

Thursday, 29 August 2013

Top 10 Tips For a Secure Business Future!

Creditserve provides an online, affordable and up to date credit checking system which allows you to carry out credit checks on your new and existing customers and/or suppliers to ensure they have the financial means to honour payments/contracts.


Key Features: 
 
 
Beneficial rates 
We offer extremely cost effective rates for one off credit checks. Regular credit checks should form part of your credit management routine on new customers, defaulting customers and those seeking an increase in their credit limit and therefore an annual subscription is often the most cost effective way to credit check your customers and suppliers.
 
Up to date information 
Our range of credit reports are updated on a live feed to ensure they include the most recent and accurate information.
 

Debt Recovery Service
Creditserve also offer this back up service to the online credit reporting and work on a no collection no commission basis. We work on all cases on pre legal basis and add costs and interests to the debt value which you are entitled to from the time the debt becomes overdue.

 
Crucial Top 10 tips for all credit control departments:- 
1. Always perform credit checks to ensure you know your customer 
2. Get your customer to complete a credit application form 
3. Wherever possible obtain a personal guarantee from company directors 
4. Get a signed contract incorporating your terms and conditions 
5. Give your customer a credit limit and review this regularly 
6. Invoice on time and ensure details are accurate 
7. Phone your customers before payments are due to ensure there are no queries 
8. Send monthly statements 
9. Use properly drafted collection letters 
10. Consider outsourcing your non paying accounts to a reputable debt collection agency like Creditserve Collections

If you would like any further information please feel free to contact me on 01992 414222 or emailmartin@creditserve.co.uk LinkedIn Martin Brown or follow on Twitter @creditserve

Tuesday, 9 April 2013

Anti Money Laundering and ID Checks Blog

In business you will be dealing with varying types of business entity and therefore there are differing ways to try and ensure you will not be left with bad debt. This blog is to give you an insight as to why carrying out AML (anti money laundering) and ID checks can benefit your company.
 
As we all assume that AML or ID checks are specifically used when carrying out consumer credit checks. However I would like to raise the point of potentially checking the business owners/directors behind a Limited company to ensure they are who they say they are and they are a viable risk in themselves.
 
We have seen a significant rise in fraud in the UK and the AML or ID checks are a very cost effective quick solution to ensuring you are not caught by this potentially damaging form of crime. Please see below what is available in these credit checks:- 
  • Instant verification of owner identity
  • Confirmation of residential address
  • Provides a detailed report for risk assessment
  • Identifies insolvent individuals
  • Verifies UK and International passports
  • Verifies utility bills
  • Verifies credit/debit cards
  • Verifies bank account
  • Verifies land register
Our AML and ID checks are ideal when credit checking sole proprietorship's and partnerships but also very useful when doing due diligence on potential customers. Some of our biggest subscribers of this information are in the financial services sector as well as large wholesale and distribution companies.

We can offer these reports individually through http://www.creditserve.co.uk/Online-Shop/Anti-money-laundering-searches or we can offer vastly reduced prices when a customer has bulk usage requirements.

If you would like any further information regarding this service or if you have any questions in general please do not hesitate in contacting me direct martin@creditserve.co.uk or 01992 414222 @creditservehttp://www.creditserve.co.uk/Products-and-Services/Consumer-AML

Monday, 31 December 2012

5 New Years Resolutions for Credit Control

1. Implement a Credit Policy for the business or review the current credit policy to ensure it's right and is working as good as it could be.

Many businesses don't have a credit policy and if that applies to you and your business then you should really implement one.

If you have one then you should regularly review it and ensure it is working for you.

A credit policy is a set of rules and criteria that you should follow when taking on new customers and considering extending them credit.

2. Ensure you have good / solid paperwork including terms and conditions as to ensure you are covered for Kate or non payers.

3. If extending credit ensure you use the minimum days of credit that you can get away with, to ensure you don't struggle with cash flow. Don't just put invoices on 30 days as normal, try 7 or 14 days and see what they think. Paying late by 30 days on a 7 day invoice is far better than being 30 days late on a 30 day invoice.

4. Rather than offering credit try taking payment upfront. This sounds like a simple idea but some sales people get on to bad habits and just offer payment terms as standard but on many of these occasions business would be happy to pay upfront on company credit cards, so try and get sales guys to change their ways and adapt to taking payments online or as part of cash collection implement processes of trying to take the payments upfront after the sales or orders have been completed.

5. Implement good solid credit control processes and procedures including wherever possible the use of automated systems to allow you to free up more time to get on the phones and collect any money due.