If you are a business owner in California—or anywhere else in the US—most likely you take great pride in the services your company offers. You have probably made many valuable contacts, business associates, and even close friends throughout the years. But no matter how much you love what you do, to be successful in business, you must keep a close eye on the bottom line.
Act on Slow-to-Pay Accounts
You may have an important client who you have been working with for years that has always been slow-paying but suddenly has become a major problem for the accounting department. While they are affecting your cash flow, you may also find it highly offensive that they seem to find it acceptable to take large quantities of products or services and then either take forever to pay—or perhaps not do so at all.
We all want to be understanding, but not at the risk of putting our own companies in financial peril. Before you hand them over as a delinquent account to a debt collector, however, try contacting the other company yourself first. If you know the other business owner personally, you may try sending them an email—and a phone call after that if you receive no communication. You may find that they are going through a minor rough patch and expect to pay you quickly, or perhaps there was an error and they have not received the invoices. It is probably worth it to give a good client the benefit of the doubt at first—and surely you would appreciate the same generosity.
Open Communication & Offer Other Payment Options
If your client is having problems paying the bill but wants to work things out, consider offering a payment plan. In the meantime, you may want to restrict any further services until their account is paid. Once that is done, consider going to a ‘payment up front’ policy. While clients may balk at first, most likely they will understand—and your accounting will be in much better shape. Consider how you would like to proceed in the future with all clients to avoid delinquencies, and discuss drawing up a new business/vendor contract (or if you have not had one previously, creating one) with your business attorney.
Non-payment by clients can be extremely frustrating. It is important to take all emotion out of the equation, however, when speaking with employees and the clients in question. If contacting them politely, offering a payment plan, or allowing them to return product does not work, you may then consider contacting your attorney to pursue further action.
Contact Us for Help Now
Do you have questions about a current business dispute? If so, contact Attorney Shane Coons. Our law office represents clients involved in a wide range of businesses and legal issues, and we would be glad to review your case and help you explore your options.
Call now at 949-333-0900 or email us at Shane.Coons@seclawoffices.com.