Collection Agency – 5 Tips To Recover Unpaid Invoices

Share this post!

Collection Agency – 5 Tips To Recover Unpaid Invoices

London businesses have to deal with financial issues daily, such as missed credit card payments, unsteady revenue etc.

A common issue that organisations face Monday to Friday is the non-payment of invoices.

Due to London being the biggest city in the UK, this presents many opportunities for unpaid invoices to arise.

If you or your business are owed money as a result of an unpaid invoice, you need to act fast.

The lifeblood of a company is its cash flow, which is why this needs to be protected at all costs.

If the cash flow suffers from health problems, this can be detrimental to the survival of the business.

Debt recovery is commonly perceived as being a complicated task that takes a long time to complete.

This perception is false as, in reality, it is only a case of having the correct training and expertise.

Your business may have a credit-control team that attempts to collect unpaid fees on a regular basis.

Smaller businesses may not have the resources to do this and waste time collecting debts by themselves.

Our experts have put together this guide to give you five tips on how you can best recover these.

Debt Collection Services: 5 Tips To Recover Unpaid Invoices

Unpaid invoices are sadly very much a part of daily business life that needs to be prevented.

If conducted correctly, the recovery of unpaid fees can be done quickly and efficiently. This will save valuable time and resources that can be used to grow the business.

We have put together a list of five top tips for London businesses to recover unpaid invoices.

1. Chase The Debtor

It goes without saying that the first step of recovering unpaid invoices is to contact the debtor.

This can be done in many different ways, such as face to face conversations or phone calls.

It has been known for businesses, especially smaller ones, to be hesitant when chasing for payment.

This is due to them not wanting to threaten the relationship by frustrating the debtor. The unpaid money is rightfully your business’s and you deserve to have this paid.

It is perfectly fine to chase for the payment, as long as this is professional and calm in nature.

2. Agree On Payment Terms Prior To Services Being Provided

Unpaid invoices can be prevented during the initial agreement stage of working with a client.

This can be done by implementing payment terms that outline the client’s obligations.

Payment terms are documents that detail how much is owed, on what date it is owed and any caveats.

This is to be signed by both parties which means the client cannot get out of paying easily.

3. Add Interest Onto Payments Or Charge Late Fees

If your debtor is refusing to honour the payment terms they have signed, you can add interest to the late payments.

The Late Payment of Commercial Debts (Interest) Act 1998 allows businesses to implement this procedure.

Claiming interest on top of any late invoice payments is a good way of getting the debtor to pay.

Alternatively, late payment charges can be laid out in the work terms and conditions.

4. Send Final Late Payment Reminders

Before further action needs to be taken, sending a final payment reminder is recommended.

Late payment reminders should be sent at least 14 days after the initial invoice due date.

If your debtor has refused to make payment and is ignoring all communications, a final notice should be sent.

The final notice will state the intention to escalate the matter should payment not be made immediately.

5. Instruct A Professional Debt Collection Agency

If all the above tasks have failed to produce a payment, you need to speak to a debt collection agency.

Instructing the service of a professional debt collector will provide you with the highest success rates available.

In some situations, sheriff officers can serve a court judgement to the debtor on behalf of the original creditor.

Whilst this can be effective, using a debt collection agency is by far the most beneficial way to recover debts.

Which Debt Collection Agency Should You Choose?

At Debt Collection London, we provide our clients with the best list of recommendations in the industry.

If a client has left invoices unpaid, you will need a commercial debt collection agency.

Our recommended agency is Federal Management, which is the UK’s leading business debt collector.

They are authorised and regulated by the Financial Conduct Authority (FCA) to recover debts under the Consumer Credit Act.

If you are self-employed and a customer has not paid an invoice on time, contact Frontline Collections.

Frontline Collections has been the most effective private debt collection agency in the UK since 2005.