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No one wants to have to collect a delinquent business debt.

It’s often a messy job.

Unfortunately for most business owners, there will come a time when you need to face an unpaid debt head on. While there are often many different explanations as to why these debts go unpaid, it’s never an ideal situation.

Luckily, there are many possible tactics to collect debt from clients. If you select the right methods, you stand a much better chance of recovering at least part of your money.

Here’s a B2B debt collection checklist that can help you take the necessary steps to get your business paid.

1. An Ounce of Prevention

Debt collection starts with prevention. The less you have to deal with chasing down money and collecting overdue debt, the better your business and financial outlook will be.

Here's how you can increase your chances of getting paid on time in the first place:

  • Communicate your invoice process with your clients. Make sure they understand your policies and process, as well as when in this process you'll be sending invoices. Eliminate any confusion that could lead to a late payment.

  • Know the red flags for habitual invoice avoiders. For example, pay attention if a client stops responding to you, or constantly avoids the subject of payment. Also, if they start making claims that are unfounded or outrageous, they may be trying to avoid payment.

  • Have a system in place to help you stay on top of invoices and their aging. Can you be alerted as soon as an invoice becomes 30 days, 60 days or 90 days past due? This will help you do your part to check on accounts and stay on top of which accounts may be late.

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2. Demanding Your Payment

Once an account becomes overdue, it’s time to start getting a bit more aggressive. You're now risking a loss, and the more overdue an invoice becomes, the less likely you are to get paid.

Demanding your payment

Here's how you take action to counter that:

  • Send a demand letter. A demand letter will inform your debtor that you're pursuing the next step, and an attorney will be collecting their debt. It also gives them the opportunity to take their own actions, such as denying debt or discussing other possible solutions to resolve it.

  • Follow up. Follow up on your letter once it's sent, preferably by phone. People have a much harder time dodging the issue when they're actually speaking to you. Make sure you talk to the right people in charge. Keep your conversation polite and civil while finding out the reason for the delay and standing your ground.

  • Get the details. No matter what they tell you, get it in writing. And don’t forget the details. For example, if they insist your payment is on the way, ask for a specific date. If they said the check is in the mail, ask when it was mailed.

3. Taking Further Action

If you’ve sent a letter and followed up and still haven't received at least partial payment, it's time to take further action and call in the professionals. They know the best ways to get a client to pay, and have the skills and resources necessary to help you do so.

Taking further action

  • Determine if the account is ready for this next step. Have you sent letters and tried numerous times to reach the customer on your own? Does the customer refuse to acknowledge they owe payment?

  • Hire a collections agency to handle your case. While you could hire a team of lawyers and investigators to help you, going straight to a collections agency will offer you expertise in debt collection, as well as the necessary legal backup.

Collecting an overdue debt can be a messy job. You don’t want to see your business in that situation at all. But if you do, you don’t want to mess it up. You can't, for the sake of your business.

Follow the items on this list to ensure you’re doing everything you can to recover that’s owed to you.