Many small and even large businesses find themselves spending a lot of time on collecting from their clients. You do not want to lose their business and even though they haven’t made any payments, you may extend them a little bit more. And then guess what, they don’t make any payments! First, get strict when lending new credit, especially to new clients. Insist on some type of credit card payment or guarantee. Secondly, give more scrutiny when considering new clients. Do your research thoroughly. Do a background check on the company and talk to some of their references.
Thirdly, maintain control over account receivables. If an account is 30 days past due, give the client a call and start letting them know their payment is due and you will insist prompt payment. Lastly, find a good debt collections agency. A good agency can do wonders for you. They will know all the laws they must abide by and are worth their 20% commission. From my experience, you have better success when going after owners that have semi-good or great credit as those people generally care about their personal credit. Ones with horrible credit will generally not care as much if any at all. Interestingly though, mostservice providers will not take debt collection agencies as a merchant so they can accept credit cards from the clients. Their are processors out there that will, but very few do.