Bad Debtors – the scoundrels of the business world!

To the small business person cash flow is vital to the very survival of their business.

To the small business person cash flow is vital to the very survival of their business.
With out the life blood of money that this provides the business, everyone in business, whether large or small, agrees that businesses wither and die. The death of the business will vary, but, if the flow of cash is restricted or cut, death is inevitable.

So, I ask the same question that every other business person asks… Why do a small number of other business people persist in their efforts to escape paying for goods and services that they receive?
Every business will potentially suffer a cash flow problem at some time and when they do their suppliers will often be willing to negotiate payment terms if they are approached with a realistic proposition for staged or late payment. So the sensible and thoughtful business person will do just that – negotiate terms! Those who don’t negotiate know only to well the potentially fatal effect that their action could have on another business person, and yet they have a total disregard for what they may be doing. Usually you will also find that those business people who don’t pay you are actually undergoing a systematic approach to the non-payment or late payment of many more of their suppliers! Annoyingly these same poor payers are often those who are also the most vocal when they themselves are not paid on time!

When you next look at your pile of unpaid invoices and statements for that particularly troublesome client remember it is possible to pursue them through the legal system for a relatively small cost – complete a claim form and send it to your County Court with a cheque for the relevant payment! Details of how the system works, and how you (YES YOU!) can complete the claims procedure are readily available on-line. Your first stop should be www.hmcourts-service.gov.uk where you should search for Small Claims under the Information About menu.

Whilst the documentation is designed for the business person to complete, you may feel that it is advisable to take advise from a solicitor on the first occasion that you complete a claim.
Often just notifying your debtor that you will be taking legal action in seven days will be sufficient to get them to pay up. If they don’t pay within that time issue your claim at the court and send a copy to the debtor – it is amazing the effect that the sight of a legal document has on people!

Businesses should unite together against these bad payers. Don’t be afraid to talk to your fellow business people about the problem – you may be surprised and find that they are suffering from the effects of the very same non-payer! By networking with our peers in the business community we can highlight these scoundrels who happily take our products and services and then, quite intentionally, fail to pay up! Let us spread the word that the small business person will no longer tolerate this behaviour.

You must however remember that the network works both ways… Don’t threaten legal action and then not proceed even if your debtor does not pay – if you do will quickly become known as an easy touch!