Your Small Business Deserves to Be Paid on Time
Categorised in: Our Blog
According to this small business financial resource – there are 30.2 million small businesses in the United States, comprising of 99.9% of all American businesses. Certainly, they are the heartbeat of the American economy.
They generate tax dollars, hire nearly half of the country’s employee workforce at nearly 60 million Americans, create millions of new jobs every year, serve their communities with important products and services, innovate and inspire.
Many small businesses grow into huge success stories. Some of the biggest companies in the United States started as small enterprises. Before becoming large empires, many were tiny operations working out of garages and basements.
As an experienced and reputable debt collection agency we know that while there are many benefits to being a small business, there can be some financial challenges. Aside from fixed costs, there are costs such as inventory, equipment, upkeep, maintenance, repair, and growth. These costs must be paid on time to keep operations going.
Small businesses can be more vulnerable to financial emergencies than big businesses with a wealth of resources. That’s why cash flow is so important to a small business. When clients don’t pay on time or refuse to pay, it can hurt a small business’s ability to maintain healthy cash flow, invest in growth, and clear its debts.
There are some common measures small businesses take to improve their accounts receivable turnover ratio:
- Contracts: While many customers don’t like signing contracts, small businesses insist on them to protect themselves.
- Deposit: Some types of small businesses find it necessary to require a deposit of between 25 and 50 percent before starting work.
- Late Payment Fees: By making late payment fees a part of the terms and conditions, a small business can incentivize timely payments.
- Timely Reminders: Small businesses who send timely reminders for unpaid invoices often achieve successful results.
- Phone Calls: Small business owners that have waited a reasonable amount of time for an invoice to be paid call or visit the client to collect revenue.
- Withholding Services: Many small businesses find it necessary to withhold services to encourage timely payment. For example, a tech company’s client is more like to clear their dues if their website doesn’t launch or time or a kill-switch removes key functionality from their app.
- Documentation: It can help a small business’s case when most of the interaction between them and the client is on email. This can be leveraged as evidence that the small business upheld their end of the bargain.
- Social Media: This one is a little tricky. Some unpaid businesses have found success by taking their concerns to social media.
When none of these steps work, many small business owners understandably become disheartened. Some even write off the debt. If you’re a small business owner waiting for your invoice to be paid, then contact us to explore your options. There are several advantages to working with us:
#1 We Serve Businesses of All Sizes
As a small business owner, you may feel like you have no alternatives when trying to collect your hard-earned revenue from a client who used your services but refuses to pay. However, you still have options. You can consider Summit A*R to be your personal debt collection agency because we work with businesses of all sizes, including veterinary clinics, self-storage businesses, landlords and property managers, independent cellular dealers, and more. No business is too large or too small to work with us!
#2 Our Rates Are Reasonable
Unlike other debt collection agencies, we don’t demand a certain number of accounts nor do we ask for payments upfront. We don’t have mandatory minimums and we work on a contingency basis. We only get paid after we’ve successfully recovered your revenue. Our system ensures that you don’t throw good money after bad accounts.
#3 We Believe in Transparency
Depending on the age, type, and balance of the account, our typical compensation involves contingency fees of between 7.5% and 50%. Once your payment is recovered, it’s immediately stored into a state-regulated client trust account. The net amount due to you on payments made, in any single month, is sent to you on the 10th of the following month
#4 We Take a Diplomatic Approach to Debt Collection
For many small businesses, reputation is very important. They earn new business thanks to the carefully cultivated relationships they’ve developed. Some hesitate to partner with a debt collection agency to collect their unpaid invoices because of concerns that their reputation could take a hit.
We know how important business relationships are to our clients. That’s why we take a diplomatic approach to debt collection. Unlike the minority of debt collectors that may threaten or harass clients, we use a friendly yet stern tone with debtors.
Not only does our strategy help preserve your reputation and relationships, but it works. We have twice the national debt recovery rate. We also have an A+ rating from the Better Business Bureau (BBB) because of our focus on customer service. On our website, you can find numerous positive reviews from customers and debtors alike.
#5 We Can Find Debtors
Some clients decide to skip town to avoid paying their debts. They may delete their social media pages, cross state lines, and cut ties with their friends and family to escape their debts. At Summit A*R, we have a sophisticated skip tracing department with a much higher find rate than our competitors.
Our skip tracing department is led by a licensed private investigator with access to cutting edge technology. Using our tools, we can find most debtors and their assets. After locating them, we remind them of their obligations and use our skilled negotiation tactics to collect your revenue.
Typically, our campaign of demand letters and phone calls is enough to motivate most debtors into paying their dues. For more stubborn delinquent customers, we have the option to report them to the major credit bureaus. Customers and businesses value their credit reports and would rather pay what they owe than be reported. A weak credit report is bad for consumers and businesses.
At Summit A*R, we believe everyone deserves to be paid for their hard work. You can reach out today to learn more about how we can help you recover your revenue.