When you are dealing with another company, offering them some service or providing them with goods and materials, it is necessary that you understand what you are getting into. At times there are signs from the beginning that will tell you about the potential client and how they are going to be in terms of payment. That way you can save yourself from the trouble by various means. But at times, one of your regular associates might fail to make the payment.
Sounds unfortunate, doesn’t it? For example, a company has been getting your services forthe last 5-7 years and has been pretty consistent about paying their invoices on time. But it might happen that all of a sudden, the payment gets stalled. It will surely disrupt the cash flow in your company. And if you are a small business owner, it will pose a quite serious financial burden on you. So, it is better to know about the red flags that will warn you beforehand that a business is not going to pay invoices. Take a look at the following points to know more.
Change in Routine Orders
When a business gets into an association with another one, they generally start to follow a pattern of dealings. For example, if your associate orders a product from you, the amount or the quantity will be consistent. Now, prior information and normal alteration might happen in orders. But if you notice a really noticeable change in ordering habits like a sudden drop in quantity or skipping order for one month, it can be a warning sign that the business might not pay your invoice. It might not be an alarming situation yet but keeping the contact number of a collection agency won’t be a bad thing either.
Difficulty to Reach
Suddenly, without any prior information, the associate gets untraceable. Maybe they are not always available to pick up your calls. Or maybe they are not respondingto your emails. This kind of lack of communication might not be a good sign for you. Find out if the payment is already pending or delayed. Also, try to find out whether this is the time of ordering a new routine order or not. In any case, if there is already a lack of communication, getting in touch with a commercial collection agency can be a wise move on your part. In case, your associate decides to leave the country, they will be able to conduct skip tracing and find your client.
Multiple Payment Methods
When it comes to business invoice payments, people go for the one that is convenient for them. Now, if you are noticing that your associate is paying you in different methods for multiple times, it can be a red flag. If they vary from online payment to cash payment to post-dated checks, then you must think of some precautionary measures so that you can avoid the immediate repercussions of failed invoice payments.
Repeated Failure and Excuses
When your associate is failing to make the payment repeatedly and constantly giving excuses for the failure, it is surely a red flag. Maybe one month, he is telling you about a huge financial loss in his company. Maybe for the next installment, you are hearing that they have met an accident. If this keeps happening for more than twice, know that you are in trouble.
Now, finally, the check they have provided you with has bounced. And they are yet to let you know when they can actually make the payment for you. And they are not even ready to make payments with a credit card. In such a case, you can be completely sure that they are not going to pay your invoice. In such a situation, an agency for business debt collection can help you out.
So, now as you know about these red flags that can be clear signs that your business associate is not going to pay on time, what are you waiting for? Look out for signs while staying close to a collection agency so that you can reach them at the time of need.