Debt Resolution has dealt with nearly every scenario possible when it comes to dealing with companies and individuals in the collection of debts. In our extensive experience in managing collections, we have come across many of the same mistakes that businesses make when providing goods and services to their clients. This section looks to offer some free, practical advice on different matters that could make all the difference to keeping your business in the black.
Structuring Terms and Conditions and Invoices
If you provide physical products to your clients, either for purchase or for rent, you should always state on the invoice that all goods remain the property of your company until the invoice is paid in full. This sets out unequivocal terms that if the goods are not paid for, you reserve the right to recoup those goods and have them returned to your company.
Servicing Overseas Companies
If your company provides services to companies either outside of Ireland, and particularly outside of the EU, your company should consider working off of a retainer basis. We have seen numerous times that foreign entities utilise service providers based in Ireland and then never pay their invoices. This becomes costly and time consuming for the service provider, taking possibly years to recoup monies owed through the courts.
What To Do When…
Your Client Refuses To Pay – There are clients that cannot pay, and there’s clients that refuse to pay, for numerous reasons. If your client is refusing to pay, firstly, ensure that you have complete documentation on what they purchased and what the terms of the invoice were. Issue a written query to them as to why they are refusing to pay and a final demand notice. Depending on if they are a limited company or not depends on your next route. If they are a limited company and still trading, there are a number of measures that can be taken but do not wait to act. If the company goes into liquidation or dissolves, your options practically disappear. If the company is just a trading business name, they do not have the protection that limited companies do and the individuals behind the company can be pursued. We can advise on all options in any case.
Your Client Goes Into Liquidation – If you find out that your client has gone into liquidation, find out who the liquidator is immediately and ensure your company gets listed as a creditor. Make sure you fill out all paperwork provided to you by the liquidator and get it returned on time. This is critical. If possible, attend the creditors meeting on the day or appoint someone to attend for you.
You Need To Engage A Collection Agency – If you have invoices that have gone beyond 90 days, it is best to engage a collection agency as soon as possible because the longer the time period that passes, the less likely your company is to recover the outstanding debt. Ensure that you have up to date records of any invoices that haven’t been paid, any relevant statements, and a written, well documented history of any correspondence with the client. This gives the collection agency background information that is critical in dealing with your client.