Every year 1.5% of companies in the construction sector go into administration. If one of these owes you money at the time, then it's very unlikely you'll see more than a fraction of what you're owed. Getting caught by a bad debt is one of the principal reasons that businesses fail, but what can you do to protect yourself?
Ask them to fill out a credit account application form
Get a credit report on customers that want to buy on credit
This will put you in a much stronger position if things go wrong.
It is a good idea to ask customers to sign to accept your general terms and conditions on the credit application form.
Don't let your processes be an excuse for your customer to avoid paying your bills
Make sure your invoices have all the right information on them - see this handy infographic for more information
Check they received it
Ensure there’s no problems and confirm a payment date
This tends to get the attention of a late-paying customer! You have a statutory right to claim interest and compensation.
Use our online late payment calculator to see how much you can add
Look out for changes in payment patterns
Credit Check your customers regularly and at least annually
Collecting your money quickly and to terms each month reduces the amount you have outstanding with customers and reduces the risk of a bad debt. My Credit Controllers has long experience of helping construction companies with collection of payments. Get in touch now to see how we can help.