2020 has been a long year for most businesses. With the challenges associated with COVID-19 and social and political unrest, it’s also been a tough one. Although the calendar changing from one year to the next doesn’t promise an end to ongoing problems, many of us still use the new year as a hopeful time for a fresh start.
There are only three full working weeks left in 2020. So, now is the time to start getting things in order to wrap up the year and prepare for a new one. Here are our top 3 tasks related to your outstanding receivables that can set you up for success in 2021.
Review Outstanding Invoices
Perhaps you have been faithfully following up on past due invoices up to this point. Or perhaps you’ve been filing them away to think about later. Maybe your routine fits somewhere in between those two extremes. Either way, now is a perfect time to take stock of those invoices. Not how long they have been outstanding, and prioritize the ones that have been unpaid for the longest. After 90 days, there is only a 74% chance of these invoices being paid, and only a 50% chance after 6 months. Use these last few weeks to follow up again. Inform your customers that you are closing out your books for the year and need to receive their payments promptly, or you will have to take further action.
Review and Refresh Your Policies and Procedures
While reviewing those outstanding invoices, you may notice some patterns. Do customers fully understand when their invoice is due and what the consequences are for nonpayment? Does your staff have a procedure to follow when invoices are unpaid? This is a great time to make changes and streamline your policies and procedures to set yourself up for success in the future.
- Make sure your payment due dates and late fees are clearly stated on your invoices.
- Clarify your in-office policy on how and when you address unpaid invoices
- Make an action plan for the life cycle of past due invoices, including what to do when they are past the point where you expect to collect them in-house.
Choose a Collection Partner
Even after tightening up your past due policies and procedures, you need to have a plan for offloading unpaid invoices. After you have exhausted your efforts to collect these payments, you should have a qualified debt collection agency ready to take over. As we stated above, accounts that have been outstanding after 90 days have increasingly slim chances of being paid. Those statistics are only compounded when you continue to try to collect in-house. A professional debt collection agency can apply years of experience and specialized action to encourage customers to bring their accounts current. Not only will this further streamline your process, but it increases your chances of getting paid. It also takes pressure off your staff to focus on what they do best.
Team Up With Southwest Recovery Services
Southwest Recovery Services is ready to step in as your partner for collecting outstanding debts for your business. Our experienced agents are highly trained in negotiating payments successfully. Not only are they successful at collecting, they are also service professionals who treat customers with the same respect that you would. We pursue many different tactics to get your debts paid faster. Click here to learn more about our process.
We would love to become part of your team in the new year. Make a call to us the last item on your end of the year checklist. It’ll be the easiest decision you make this quarter. We look forward to speaking with you!