Is Legislation The Only Method Of Getting A Large Business Who Are Tardy In Settling Invoices To Pay On Time?
For small enterprises who have been working with large enterprises for years and find that on occasions the larger enterprise is slow in settling the bills, this can be a frustrating situation to be in. On the one hand the small enterprise needs to be paid if it is to stay in business, but it also needs to keep on good terms with the large enterprise in order to sustain a steady flow of work.
There is legislation in place in the form of the “Late Payment of Commercial Debts (Interest) Act 2002”, which allows the small enterprise the choice of imposing a one-off charge as well as daily interest, if it so chooses, to persuade the large enterprise to settle the account. Whether or not to apply this legislation is a hard question for the small enterprise, but if the large enterprise has been settling late in the past, it may be wise to sort out this issue, before resorting to Debt collection procedure.
To start the small enterprise should contact the large enterprise and try and discuss the matter face to face in the hope of coming to an amicable solution, but if this fails then they may have to resort to Debt collection methods.
The small enterprise may think that their only choice is to see a solicitor and see if they can help. Any solicitor may know about the aforementioned legislation, but one who specialises in Debt collection may be able to demonstrate evidence of how successful they have been in applying this to cases, maybe some Debt collection letters, which of course will have had client details blocked out.
If the small enterprise is suffering cash flow problems then the costs of using a solicitor or a Debt collection agency may be prohibitive and so they may need to check out some Debt collection software that they can buy in order to carry out the work themselves. They would need to carefully evaluate Debt collection software packages that they find in order to choose one that has the right facilities. The generating of Debt collection letters is the key to the Debt collection procedure and the Debt collection software must provide the user with an easy way of generating Debt collection letters that are written in ethical and unemotional terms, applying key aspects of the legislation where relevant. It is essential that the Debt collection letters are written to emphasise the advantages of the current partnership such as; proven work standards, fully trained personnel, and quick response to essential issues.
In the end, it would be unwise for either the large enterprise or the small enterprise to break off relations. The large enterprise would have to start looking for a enterprise to take the place of one that they know well and are satisfied with the work and whose workers know the large enterprise as well as their safety procedures and are probably on good relations with the workers of the large enterprise. The small enterprise will have to look for work elsewhere as they may well have only worked for the one large enterprise and now are faced with trying to sell their services elsewhere in order to keep their staff and keep the enterprise going.
So renegotiating the contract with a clause for late payments would be a good move for both parties
Related posts:
- Monetary Debt Relief With Christian Debt Counseling As the Proverb that says “The rich rule over the...
Tagged as: collection · debt recovery · invoices · overdue · past due
