Newspaper article The Journal (Newcastle, England)

Debt Recovery Is Crucial for Small Businesses; HAY & Kilner Solicitors Offers Advice on Ways Businesses Can Improve Cash Flow

Newspaper article The Journal (Newcastle, England)

Debt Recovery Is Crucial for Small Businesses; HAY & Kilner Solicitors Offers Advice on Ways Businesses Can Improve Cash Flow

Article excerpt

GETTING paid may not sound like rocket science but for many SMEs the reality is often a challenging, time consuming and expensive diversion from their main business activity.

Specialist solicitors are often used to achieve effective recoveries. A business which has battled for weeks or even months to chase an overdue account for payment may find a swift solicitor's letter is very effective.

In the present economic climate, recovering business debts is sharply in focus. Barry Arkle, manager of Hay & Kilner's debt recovery team, has helped many clients who are suffering the detrimental effect of late payment by creditors. The experienced team provides effective solutions by utilising its market leading recovery systems and are also able to provide advice to clients on improving their credit control systems.

There are a number of actions, some preventative, others reactive, to implement.

Sales and new customers are always considered paramount. Successful credit control and keeping an eye on business cash flow is just as important - an unpaid invoice of pounds 2,000 with a 20% profit margin would require your business to generate an additional pounds 10,000 in sales to recoup it.

Ensure new customers are aware of your credit terms from the start; send conditions of business in writing so there is no confusion. In the cut and thrust of business it is often difficult to maintain an accurate record of your contractual transactions but maintaining an evidence trail is really valuable to ensure you are legally in the strongest position in the event of a contract or debt dispute. Disputes can be lost or have to be conceded simply because the other party''s evidence is superior. All outstanding invoices over 30 days have an immediate impact on monthly cashflow. At this stage you should communicate regularly until the matter is resolved. …

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