By Ellie Campbell, a freelance content writer and campaign manager for Ross & Liddell
IN an ideal world, credit would run smoothly through any business. Getting invoices on time and paid when needed can sometimes seem like a dream onto itself. In reality, credit control is something every business will have hiccups trying to deal with.
From late invoices to chasing payments to getting into unnecessary disputes resolved, any way a business can improve their relationship with credit control is a must.
Let’s look at some of the ways anyone can look after credit control for commercial properties without it being a problem that snowballs over time.
Understanding the payment process
Clarity is your best friend when it comes to credit control. Whenever you’re about to undertake some form of credit control, have the process made as clear and concise as possible; otherwise, the chase may come back to bite you.
Whether it’s taking on a tenant for a building, starting a contract with a supplier, or carrying out any dependency, you’ll want them to see:
- Your process for payment
- Your information for payments
- When you expect payments
- What your set period is (usually 14 days at the latest)
- How often you’ll be in touch if payment is late
- How many times you’ll be in touch
- Any interest that gets added due to late payments
- When and how you take legal action due to missed payments
These steps aren’t made to scare people away, but merely to show that you take things seriously and so should they. Your clarity also helps show how easy the process is.
Always be ‘on’ the record
Open communication is a good thing to have. Having no record of such is bad for both sides. Whether you’re owed money, or you owe someone money, avoiding late payments and the possibility of ending up in a small claims court is a must.
Keeping a record of communications is easier than you think and will help immensely. The first place to start is always with emails. Anytime you make or receive a call which relates to a specific topic, which could lead towards a dispute, as soon as the call is over, make a note of it and email it to that person.
It may seem like a tedious task to carry out, but having something permanent which says XYZ on it being shared between both parties will be the only thing going for you in the very rare case you end up in court. It will help highlight you’ve been proactive with a problem and won’t muddy the water should the other party make claims against certain dates or phone calls you can’t remember.
Even if you can’t always email, a quick voice note in WhatsApp or a similar messaging app to the other party will provide some form of understanding against key dates.
Understanding customer rights
Always remember that credit is a two-way street, and while creditors have rights in place to help with payments, customers/tenants do too.
The most common hurdle for creditors would be finding out a customer has been placed under a moratorium. It is rare in the UK, but it does happen and is something that complicates matters immeasurably. When this happens, it is important to weigh up whether the creditors want legal help from a solicitor or debt management agency before even thinking of going to the county court.
Getting expert help
Not everyone running a business will be an expert with the ins & out of credit management. If any of the points I’ve raised here feel as though they’ll cause confusion, I recommend finding a reputable manager who deals with credit control for commercial properties.
A dedicated manager takes all the stress off your shoulders and manages credit on your behalf. They also will have procedures in place from the experience of dealing with payment problems time and time again, while letting you get on with running a business uninterrupted.