If your business extends credit, you might want to take a look at what is going on around you. Mills are closing, disasters are happening, recession is hitting, do you have customers that owe you money? Are they in a position to pay you? Will they be in a position to pay you in 6 months? What will you do if they can’t pay you? How will you pay your bills?
Now is a very good time to make sure everyone’s credit applications are up to date and signed, make sure all accounts are current and really work on getting anyone who is past due, paid up. It is easier to keep a handle on your receivables when you begin with them under control. Once they get out of hand it is harder to keep them from becoming past due.
The best advice I can offer you to collect more money quickly begins with not feeling guilty asking for the money, unless you like working for free. Develop a credit policy or at least a list of payment rules everyone can follow. Keep on top of late payers, call them or send them a notice, but do something! If you find you just can’t do these things or you don’t have the time, you can hire a credit manager to do them or outsource the task. A few more things you can do are to contact customers immediately if not sooner if they become past due, set up payment plans for the full amount due, be firm and don’t accept excuses and above all, be professional.
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