It can be tough to know what action to take when a large company is late in paying the latest bill for work done or products supplied by a small company. The small company could have done work for the large company many times and expects to be paid on time as before, but this could be a troublesome time for the large company, especially if they are also waiting for unpaid invoices from even larger businesses.
Rather than resorting to Debt collection strategies at once, the small company could well want to take into consideration the relationship they have built upwith the large company, as jumping in too soon with threatening Debt collection letters could so easily ruin that carefully built up relationship.
The first thing the small company should do is touch base with the large company and jog their memory that the payment is late and see if they can do something about it. If this fails to produce a payment of some kind at least, then the small company could well wish to try a different approach for Debt collection, such as a solicitor who specialises in Debt collection, a Debt collection organisation, or buy a Debt collection software package and take on the Debt collection in-house.
There are pros and cons to each of these choices, the solicitor and the Debt collection organisation will make charges, either up front, or after completion of the Debt collection method, but they are likely to be based on the value of the debt and so could be significant. They could also require part payments if the Debt collection method takes longer than anticipated, such as for sending out multiple Debt collection letters. They would be expected to do a professional job and have experience in Debt collection and so they could well achieve a good success rate. The Debt collection software would be a one-off purchase but would need an employee to operate it if the small company is to get payback out of the Debt collection software. How successful it is depends mainly on how good the Debt collection software package is, such as the quality and content of the on-line help, or a written instruction manual that has a tutorial that can be used to train or direct the operator through the Debt collection method, in particular in the composition of Debt collection letters as these form the core of Debt collection. A good package would include templates of Debt collection letters that would demonstrate what sort of things to write at the different stages of the Debt collection method if multiple Debt collection letters are required. The Debt collection software should identify the need to keep the phraseology of Debt collection letters on a professional and ethical standing as these demonstrate the professionalism of the small company and any use of emotional or unethical phraseology could so easily break up the business relationship that has been built up, whereas a solicitor or Debt collection organisation would need to charge for each and every future debt that they are asked to chase, although the Debt collection software could have a cost in a part of a workers job and any printer consumables and obviously the postage of Debt collection letters.
