It’s no secret that positive cash flow is the life blood of any business. Few people enjoy chasing valued customers for unpaid accounts, but to keep the cash flowing through your business it’s crucial to stay on top of your outstanding debtors. The need for follow up correspondence cannot be stressed enough when it comes to chasing money. By following the rules and etiquette of debt recovery you will enjoy greater success and less stress.
So let’s start at the point where the first invoice and statement have not been paid. You should send the invoice again with a friendly reminder letter as per the template below if the first invoice remains unpaid.
So what happens if you receive no response within 7 days?
Make the phone calls and remember to remain calm and confident at all times. Make sure you have all the information about the debt on hand when you make the call or approach the customer face to face if they happen to be close by. Don’t get personal, unjustified threats or intimidation tactics are contrary to law and can work against you if legal proceedings are commenced. Maintain a professional approach, no matter how badly done by you may feel. When reminder notices and polite calls fail to achieve the desired response a ‘Letter of Demand’ can render positive results.
A Letter of Demand serves two purposes.
It sends a clear signal to the debtor that you are prepared to start legal proceeding unless the debt is paid.