Cash flow management: What to do when your customer doesn’t pay

How to proactively increase your recovery odds, while keeping your small business cash flow  protected.
 

The due date comes...  and goes and you wonder ‘will your customer pay?’ How do you know if a good customer is starting to struggle? The threat is real.

What steps should you take to maximise the chances of getting your money back?

• Address non-payment the minute that an invoice becomes overdue 
  
• Sending notices of late invoices will highlight the issue. It also provides a valuable paper trail in case you need to escalate the matter later
• Are you tracking all your activities with key dates and communications?
  

• Do you have the right people in place on your team?
• Who’s doing the chasing? Have you defined your escalation process?
• Are you talking to the right person on their side? Who is in charge? Who has the power to get things moving?
   

• Are you consulting with legal and collections?
• Is it time to act?

• Do you have a trace with your signed documentation to date?
• Is it in order and without gaps?
• To collect on a debt, you will need to have all of the relevant supporting documentation. Every time you work with a customer create a contract that specifies what you are providing and an agreed payment schedule.