Businesses, especially small businesses, one unpaid invoice from a customer could put a financial strain on the entire company. After all, one unpaid debt really is the difference between profitability and net losses. There are a number of services available to both large and small businesses that can help them avoid net losses.
The first service that is available is customer research. Customer research may sound like it is a marketing strategy, but when used for financial purposes it can really be the difference between a paid invoice and unpaid invoice.
Customer research involves hiring a particular company to do extensive research on customers. This type of research is extremely important, especially if a company has recently had an increase in number of bounced checks from customers. A company can be hired to do customer research on those particular customers. The customer research will help provide the company with a better picture of if future checks will clear and what financial state the customer might currently be in.
Another service that is available includes a do it yourself debt settlement service. Many businesses believe the only way to collect on a bad debt is to hire a bad debt recovery company, but that is not the only option. Companies can create their own debt collection system that avoids having to rely upon the services of another company.
A do it yourself debt settlement service may provide access to a collection agency. Some companies can hire a collection agency just to write a letter to collect on a debt, but not actually turn the debt over the agency. This allows the business to collect the debt without having to pay a portion to the collection agency.
Another suggestion given by debt settlement solutions is to try to collect whatever you can from the customer. For example, if a customer is having extreme financial hardship, ask what they can afford to pay. This will help avoid any bad debt accumulating, but still get money for a business.
Preventing bad debt from accumulating could be the difference between a business turning a profit and having to account for net losses.