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What makes a company run smoothly, you may ask? The answer is easy. Money. And when the going gets tough, businesses without invoicing and any system to collect debt tend to feel the heat. It is a basic fact that any company that provides credit to its customers must send them a bill as soon as it is possible and have ways to be sure that accounts are collected on time.

First of all, any business requires a systematic way to make sure that its invoices are paid within its trading terms. This includes a document that needs to be signed by the client, setting out the trading terms. These terms include when the company will invoice, when payment should be made, and what the consequences of not paying an account by the deadline will be. Among these consequences might be an account keeping fee that is charged once an account has gone upaid for a set period of time, a hold being put on goods or services and a final deadline by which time the account will be sent out to collections.

These trading conditions must be signed and held in the customer file. Additionally, there will have to be administrative systems in place to be sure that the company’s invoices are sent out according to its policy. Business owners should never let fear of losing a customer get in the way of having a debt collection policy that is efficient.

The next issue to hone in on is a debt collection system that is centered on personal contact rather than letters and statements. Experience shows us that collection is way more efficient when customers receive phone calls instead of threatening letters. The first step is a telephone call to customers who haven’t paid their bill within the terms that they agreed to. The phone call should be scripted and timely; within a few weeks of the account becoming overdue. From the beginning, the person making the call has to establish that there was nothing wrong with the services or goods that were supplied.

If there was something wrong, this should be addressed promptly and a new payment date should be agreed upon between the collector and the customer. If the bill is still not satisfied by the next deadline, make another telephone call informing the customer that the account keeping fee will be charged, and that if the account goes past the next deadlines, supply will end and collections will begin. As far as debt collection agencies go, an agency that works on a no collection, no fee policy is usually the best choice.

Rapid Recovery Solution is a New York collection agency. Get a totally unique version of this article from our article submission service