It’s a new year. The corporate lull of the Holidays has passed and routines have been established once again. New goals have been set, new calendars posted on the walls and new government officials have taken the offices to which they were elected in November. Spring is on the horizon, bringing with it a thaw, a host of new, green buds and a fresh newness of life. A sense of new beginnings is tangible.
As you dive into work with a renewed sense of vigor and motivation, you will quickly be met with obstacles, not the least of which is a looming April 15 tax deadline. Take a deep breath and read on for some additional motivation. All good runners hit a “wall” at some point and learn to run through it. For the financial health of your company, you must do the same.
Gathering tax documents can be tedious and disheartening, especially if you anticipate owing Uncle Sam. However, as you are gathering documents and reports from last year, kill two birds with one stone by also checking last year’s balances for each of your clients.
After a certain amount of time has passed, it becomes too easy to sweep unpaid client invoices under the rug and move forward. Don’t. A new year means a clean slate, but it does not mean you have to provide products and services for free to clients who forgot or are refusing to pay. You’re digging through your files anyway. Make two folders and sort as you go.
Studies have shown that the longer a debt goes unpaid, the less likely it is that it will ever be paid. It is in your best interest to follow up on unpaid invoices sooner rather than later. Collect all the debt recovery documents you need, and start the process as soon as possible. It will affect your profits and minimize your losses to collect on past due accounts.
Some of the documentation you may need includes:
- The last known address and phone number of the debtor
- An order form or contract
- Tracking numbers (if the product was shipped)
- Proof of service or delivery of product
- Receipts showing what, if anything, has already been paid
- A copy of any invoices that were sent to the debtor
- Detailed records of any contact your company has had with the debtor regarding the debt
Debt recovery is time consuming. If gathering the documentation seems overwhelming, contact a debt collection agency to help you get the finances in order. Professionals have experience with such matters and have access to databases and networks you don’t. Those tools help them to track down debtors and recover funds for your company. Sweeping unpaid invoices under the rug is accepting a loss. Don’t concede so easily. Start the year off right by making the numbers match the efforts of the past year. And don’t be afraid to call in the reinforcements to help you.