Enforcing your Debts !
The negative impact of bad debt on the cash flow of any business can be alleviated in a few easy steps.
A formal credit policy based on the cash needs of your business must be compiled which should provide for the following
1. The period within which payment should be made for example 60 days.
2. The method of payment for instance in cash on the premises or by way of deposit.
3. Interest-rate. It should be noted that the charging of interest will subject the transaction to the provisions of the new credit act.
4. The actions to be taken internally before accounts are handed over for collection.
Your credit policy must be communicated regularly and unequivocally to your clients/customers.
The credit policy must be embodied in a written agreement, which should also contain provisions concerning domicilium addresses and attorney and client costs. The above agreement must be signed by every client/customer without exception.
Correct statements should be forwarded to clients on a monthly basis. In the event that the period for repayment has been exceeded a written notice should be forwarded to the client/customer. Should the written notice not produce the required result the client/customer should be contacted telephonically and requested to furnish a date for payment that suit his/her financial ability.
Should the client/customer neglects to make payment on the chosen date his account should be handed over for collection without exception.
Clients, without exception, blame their collection agents for a lack of results while the delay in the handing over of accounts should be blamed for bad results, specifically as the debtor relocated and have to be traced again and further due to the fact that the debtor already incurred other financial obligations. It should be borne in mind that if the debtor did not respond to your first notice or telephone call he/she will most probably not respond to any number of subsequent calls or notices.
Strict enforcement of an effective credit policy will not only improve your cash flow but will also cultivate a culture of prompt payment amongst your clients/customers, which will prevent future bad debts.
How can we assist you ?
Baartman & du Plessis Attorneys successfully assisted a large number of medical professionals, schools, small businesses and financial institutions over the past decade, which caused us to
1. gain extensive knowledge and experience
2. develop an impressive infrastructure, which include :-
a. live deed, company and credit profile searches, reducing tracing cost to a bare minimum.
b. automated SMS systems to ensure regular payments from debtors.
c. automated progress reports, which ensures that you will be kept informed of our progress.
d. Automated collection, litigation and administrative systems.
3. develop service products aimed at the unique needs of our clients not requiring our clients to adapt to our service products.
4. recruit a team of dedicated and experienced personnel.
5. establish ourselves in various magisterial districts, which ensures that we can serve our clients in the districts of Pretoria, Wonderboom, Soshanguve as well as Temba, without incurring any additional costs.