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CREDIT CONTROL – Tips for businesses

The credit crunch may in theory be a distant bad dream but it is still as important as ever that businesses effectively manage payment of invoices to keep cash flow at its maximum. Prompt payment of invoices can mean the difference between success and failure of your business. A healthy bank balance could protect you should the worst happen in the future. So what can you do as a business to ensure you get paid on time?


  • Make sure that your terms and conditions are up to date and comprehensive enough to protect you in the event of non-payment of invoices for example with a retention of title clause. If you think that your terms and conditions may require updating or if you do not have standard terms and conditions and you would like some advice on this, Shaun Owen in our Business Services team can assist.
  • If you do have terms and conditions make sure that you provide copies of these to those with whom you are contracting.   Draw attention to the payment terms to ensure prompt payment.
  • If you currently allow a long period of time within which invoices are payable, consider reducing this term to increase your cash flow.
  • Ensure that your invoices specify the date for payment e.g “Payable within 14 days” so that the other party knows when payment is due. If you send covering letters with invoices then draw attention to the payment terms in the covering letter also.
  • If your business is such that you are able to request payments on account it is advisable to do so in order to minimise your exposure should the invoice not be paid by the other party.
  • When you send out an invoice, diarise the payment date (if you do not already have a computer system which does this automatically) in order to keep track of when the payment is due.
  • If the invoice is not paid by the due date then make sure that you chase up payment within 7 days by sending a polite 14 days chasing letter. It may be that the other party did not receive the invoice, that payment has been overlooked or that the invoice has been misplaced. Diarise to chase up payment again after the expiry of the 14 days.
  • If the invoice remains unpaid after 14 days, chase up with a 7 day letter.
  • Establish with the other side whether the invoice is disputed for any reason – this will affect how you may proceed at a later date.
  • It is crucial that you keep in contact with those with whom you contract. If you lose contact with them you may end up incurring further costs trying to locate the party later which may not be recoverable.       This is especially important where you are contracting with individuals.
  • If the other party contacts you and states that they are unable to pay the invoice, consider allowing them to pay by instalments. Try to come to an arrangement whereby the invoice is cleared in no more than 12months.
  • Do not exacerbate the problem by continuing to do work for a customer who has not paid an invoice.
  • Avoid letting unpaid invoices mount up.


If after following the above you do not have any success in securing payment and you require legal advice you can use one of our solicitors with direct telephone and email access to achieve quick results. 

As part of our service to business clients we offer a fast cost effective service to recover money due to you before a cash flow crisis develops. From a simple warning letter to the issue of proceedings we are able to agree a fixed price to get the job done for you.

We are here to make sure that you remain efficient and successful. 

For further information please contact Stacey Humm on 01905 727807 or e-mail

Added: 21 Mar 2016 15:39

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