There is never a cast iron guarantee that one will get paid, but it is still prudent to take certain precautions before granting credit.
The excuses not to pay are a mile long and here are some of the most common and ways to counteract them.
- “The cheque is in the post”.
The oldest line in the world. As you don’t have any influence over Royal Mail, it’s the debtors responsibility to put alternative arrangements in place to ensure you are paid in good time.
- “We’ve run out of cheques” or “We’ve lost the cheque book”
BACS and CHAPS payments are far more common these days and most businesses have access to on-line banking.
- “I am waiting for a copy invoice”.
A copy invoice can generally be scanned and e-mailed in minutes. Once confirmed the email has been received, always get the debtor to commit to a date as to when you can expect payment.
- “We are waiting for the customer to pay”.
While it enhances a client relationship to have some sympathy with their cashflow issues, their cashflow is not your responsibility, and besides you have your own to worry about. Remind the client of your agreed payment terms, point out the additional time they have already had and insist on an expected payment date.
- “The signatory has been in hospital / is on holiday”.
Again, not your responsibility and it is up to the company to put alternative arrangements in place. Insist on an expected payment date.
- “We are going into liquidation”.
Request the name and details of the Insolvency Practitioner. There should be no delay in giving you this information.
- “There is a dispute with the invoice”.
After three months? Insist on the issues stated in writing immediately and endeavour to get them resolved as soon as possible. Keep an audit trail of all communication.
- “Our internet is down”.
Request a cheque payment, send a courier to pick it up if necessary.
