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Credit Kills Profit – Part 2

In our last blog, we have already outlined a procedure on how companies can guard themselves against bad debts by introducing a Credit and Application Form and Terms and Conditions that should be submitted and filled out by any potential customer.

One of the most crucial parts of controlling the credit is that the terms of trade agreed to by the new client through signing the form, must be adhered to once the customer has been evaluated and services performed. To make sure the new customer recognises the payment commitments he/she agreed to, it is essential that the collection effort is tightly claimed. For keeping a sustainable business relationship in the future it is significant that there are set boundaries on due dates and no extended terms given, not only to protect your own business from possible fatal damage but to set the framework for the new collaboration and its collection procedure.

Given all this, it is crucial to set the right date for the first deadline, such as to make sure the new client does not get the impression of free play allowance in terms or you might end up forever collecting a debt from this specific customer. Nevertheless, a new customer will always welcome a civil reminder on the due date before any further approach should be considered.

Once the client has fallen back in payment, the next step taken could be receivable report letters written on a weekly basis. Their wording might intensify over time to stress the degree of urgency and to keep the pressure on the credit department.

A lot of companies set up a phone call after around 14 days past the due date in order to encourage the client to settle the payments and remind them of the terms of trade. The right point in time for such verbal reminder may have been previously appointed and confirmed in the Terms and Condition.

After having undertaken all these steps and the account still being over terms of 30 days, it might be time to take a different action and move on to the next phase. To save your business from significant damage through bad debts you should consider getting external assistance through a collection agency. In selecting the right agency, it is vital to make sure to find one that absolutely understands your business and knows how to work hand in hand with your own credit department.

Having undergone this series of procedures to prevent the crushing experience of bad debts, it is almost certain that your business can keep making a solid profit rather than facing outstanding cash that is still needing to be claimed.

If you would like to learn more about the debt collection services we offer, contact us now. We have over 30 years of experience providing professional and discreet debt collection solutions for clients of all sizes and across all industries. Our debt collection services are available in  Sydney, Melbourne and Brisbane.

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  • I have worked closely with Boston Commercial Services for over twenty years across four different companies and would not work with anyone else in regards to helping me with my outstanding accounts. Whenever I have started a new role, the first thing I am asked is, “How would you go about cleaning up our accounts receivable ledger?” My answer is always the same – “The first thing we need to do is call Boston Commercial Services”.

    Voytek Bradford

    Freedom Foods Group Limited (National Credit Manager)

  • I have known the principal of the BOSTON Group (Derryn HARRISON) as well as key staff members (including Ben GOWER) for well over 2 decades and have been using their professional services for myself as well as for Powerhouse Logistics Pty. Ltd. on a regular basis, not only in Sydney but on a national basis.

    At all times BOSTON have been extremely pro-active, attentive, courteous and professional with all matters we threw at them. Their advice has always been extremely sound and commercial and I find them to be a "breath of fresh air" within the legal fraternity and have no hesitation whatsoever to highly recommend them.

    Peter Brueckner

    Powerhouse Logistics Pty Ltd (CEO)

  • Expect A Star has worked with The Boston Group for 10 years. In this time we have appreciated the ongoing support of Boston for all of our collection and legal requirements. Like most businesses cashflow is critical to ongoing success and growth, with Boston we have found a partner who are an extension of our business and play a key part in our cashflow management. The Boston Group bring a level of expertise to our business which is valuable and coupled with their excellent customer service we look forward to continuing to work with them for many years to come.

    Ryan Meldrum

    Former CEO

  • I have been using the services of The Boston Group and their legal entity for over 11 years. During this time I have found their service to be impeccable, delivered with the utmost professionalism and integrity. The vast majority of cases that I have placed with Boston were far from straightforward, requiring legal acumen and delicate handling. Having used all methods available without success to procure payment, I confidently placed these matters into their safe hands. In all instances a successful outcome was achieved.

    Mark Parish

    Credit Manager

  • SNP Security has had the pleasure of working with Boston Commercial Services for the past 11 years. Boston has played an integral part in the continuing success of SNP Security’s low DSO’s, 90 Day % Debt & of course Bad Debts Written Off.

    Amanda Griffiths

    National Administration Manager

Boston Commercial Services prides itself in offering specialised, professional services, through a highly experienced team of debt collector, with personalised client attention.