Improved Data Services often works with small business owners to fulfill or improve upon their debt collection process. Businesses that do not have a strong debt collection process in place can cost themselves valuable time, energy and resources. Today, Improved Data Services has compiled some of the biggest mistakes small businesses make in their debt collection process and what can be done to remedy them.
The first mistake made by small businesses is working without the safety net of a signed contracts. It is important to have contracts in place to protect the business and the customers. Clear and transparent paperwork ensures both parties are responsible to honor their obligations. In addition to protecting interests, it will also help settle any dispute that arises. It’s much easier to recuperate unclaimed fees when the client is contractually obligated to pay.
Another common mistake is not understanding the nuances between an outstanding payment from another business as opposed to an individual. There are different laws in place depending on the type of party who owes. This can make a world of difference in determining the best approach to collecting a debt. In addition to understanding these differences, a business should also do their research before taking on a client. Research upfront can help protect a company’s interests. Taking the time to do some basic research and collect some essential data can help ensure that a business is starting a relationship with a reputable source.
The biggest mistake a small business makes is putting the responsibility of debt collection into the wrong hands. Handling receivables correctly is the lifeblood of any business. Debt collection is often a task that owners try to take on themselves. Unfortunately, time is a requirement in this endeavor, which is something most CEO’s severely lack. Great leadership recognizes that they do not have the time to give the attention to debt collection that it requires. The choice then becomes hiring a partner or designating an employee to this task.
Finally, some small business owners decide to go the legal route with all their debt collection needs. This can prove to be incredibly costly. If a lawyer is successful, legal fees can still come back that all but wipe away any funds that were recuperated. Improved Data Services understands how to form relationships with people and businesses. Their team gets to know the issues at hand and does everything it takes to collect the debt in the best way possible for all involved parties.