Recovering unpaid invoices via debt collection agency for b2b + lba

[rubaba]

Good morning all,

My company sells electronic services to mainly to taxi companies, travel companies etc.

My payment terms state that payment should be made upon delivery, although im not strict upon this and usually give few weeks time for payment. However there are a few companies who have not paid me and its now been a couple of months totalling up to 40/50k.

I wanted suggestions/advice as to what is the most efficient/cheapest way to recover the funds. Tried to chase the companies up on a weekly basis and now tired of getting messed around.

Seen suggestions on here of sending out LBA- Any recommendations who to use?

Also read that commercial debt litigators are cheaper to use than solicitors- can anyone confirm this and point me in the right direction as who are good.

Thanks in advance

 

[Newchodge]

You might have a look at Thomas Higgins

 

[Bob Morgan]

A 'Timeout' in the software?

 

[Mr D]

Are you comfortable giving that level of credit? You have credit checked the companies concerned?

Are any likely to go under owing you?

May be worth tightening up credit facilities. Including stopping accounts owing money.

 

[Blaby Loyal]

Due to the length of time you imply the debts have been outstanding plus their apparent value, it sounds to me like you might be needing the services of a decent solicitor to pursue these debts through the courts.

Make sure all your papers on each account sent to the solicitors is in "apple pie" order and make sure that whoever you instruct doesn't just play 'letter tennis' i.e. spending your money without actually progressing matters.

 

[rubaba]

Are you comfortable giving that level of credit? You have credit checked the companies concerned?

Are any likely to go under owing you?

May be worth tightening up credit facilities. Including stopping accounts owing money.

No they are running businesses. We have not provided them any more services until they pay their outstanding debts,

 

[rubaba]

Due to the length of time you imply the debts have been outstanding plus their apparent value, it sounds to me like you might be needing the services of a decent solicitor to pursue these debts through the courts.

Make sure all your papers on each account sent to the solicitors is in "apple pie" order and make sure that whoever you instruct doesn't just play 'letter tennis' i.e. spending your money without actually progressing matters.

Isnt using commercial debt litigators a cheaper option than solicitors? Can anyone shed light towards the pros and cons.

Most of the debts are under 10k per company so would not the small claims option be best?

 

[Deleted member 59730]

What you need is an efficient in-house debt chasing system. Send statements once and then follow up with a letter plus copy of the original invoice. I used red envelopes like greeting cards and hand wrote the addresses. After that its a phone call and a request for them to get their debit card out.

Thomas Hggins as a last resort.

 

[Mr D]

No they are running businesses. We have not provided them any more services until they pay their outstanding debts,

Carillion was a running business. Until it wasn't running any more.

 

[Darcey Quigley & Co]

Isnt using commercial debt litigators a cheaper option than solicitors? Can anyone shed light towards the pros and cons.

Most of the debts are under 10k per company so would not the small claims option be best?

Hello, in terms of the small claims court it can be time consuming and once awarded judgement/decree you then need to enforce this which is another cost.

If using a commercial debt recovery company it is significantly quicker and is risk free. Ensure that the company you choose is no win no fee and you only pay upon successful recovery of the debt.

 

[Mark T Jones]

There was a collection company on here - I believe they were called Thornbury Collection - Not sure if they are still members

Anyway, I certainly wouldn't be looking for the cheapest option at this stage, I'd be looking for someone who can demonstrate results (legally)

Moving forward, as others have said, get a serious credit policy in place

 

[rubaba]

There was a collection company on here - I believe they were called Thornbury Collection - Not sure if they are still members

Anyway, I certainly wouldn't be looking for the cheapest option at this stage, I'd be looking for someone who can demonstrate results (legally)

Moving forward, as others have said, get a serious credit policy in place

What would you suggest as a serious credit policy? As mentioned above the terms are payment upon delivery. 90% pay but its trying to get the 10% to pay and not fall behind, especially few months.

Thanks

 

[Newchodge]

What would you suggest as a serious credit policy? As mentioned above the terms are payment upon delivery. 90% pay but its trying to get the 10% to pay and not fall behind, especially few months.

Thanks

Dead simple. Payment on delivery. Non payment on delivery means immediate suspension of supply except for payment in advance. Day of non-payment send a reminder letter. 1 week later send a reminder letter stating that if payment is not received within 14 days the matter will be escalated to debt collector or legal action. And follow through!

Payment within 21 days re-introduces payment on delivery the first time it happens. If it happens a second time then supply only on payment in advance.

Payment after 21 days means only payment in advance for future orders.

You may lose a few customers, but if they don't pay they are not customers, they are using you as their bank.

 

[Mr D]

What would you suggest as a serious credit policy? As mentioned above the terms are payment upon delivery. 90% pay but its trying to get the 10% to pay and not fall behind, especially few months.

Thanks

The people you are allowing credit to could at some point delay and delay, maybe go under. Its you lending, you may be happy lending to these companies. They will presumably be happy borrowing by the sound of it.
Your risk. At some point you almost certainly will have a debt you can't recover.

 

[rubaba]

Dead simple. Payment on delivery. Non payment on delivery means immediate suspension of supply except for payment in advance. Day of non-payment send a reminder letter. 1 week later send a reminder letter stating that if payment is not received within 14 days the matter will be escalated to debt collector or legal action. And follow through!

Payment within 21 days re-introduces payment on delivery the first time it happens. If it happens a second time then supply only on payment in advance.

Payment after 21 days means only payment in advance for future orders.

You may lose a few customers, but if they don't pay they are not customers, they are using you as their bank.

Great advice. Thanks

 

[Mark T Jones]

What would you suggest as a serious credit policy? As mentioned above the terms are payment upon delivery. 90% pay but its trying to get the 10% to pay and not fall behind, especially few months.

Thanks

Like others have said, your best policy is 100% cash in advance

Presumably there is a reason you chose to offer a few customers credit? Whatever the reason, if you are going to offer credit you must be clear on who you offer it to, when/why you do and how you will collect

 

[smallclaimsassistance]

You might have a look at Thomas Higgins

Don't go to Thomas Higgins unless you are absolutely certain that your debt is undisputed. This is not my advice. It is a term of the TH contract.

I have recently picked up one client whose case was issued by TH on the strength of his belief that the debt was undisputed. The defendant applied to strike out the claim on the basis that the debt was not only disputed, but the defendant disputed that he had ever had a contract with the claimant. TH were not prepared to assist any further and quoted their terms and conditions which stated at several points in their process that they do not become involved in disputed claims.

Finally, I agree with others above. It doesn't help with your past debt, but for the future, you must take action before debts get to this stage.

Dean

 

[Steve Thornbury]

Hello!

Yes we are still on here @Mark T Jones!!

How can we help you @rubaba