Get Control of Late Paying Customers Before They Become a Larger Problem
Getting customers to pay is an evergreen business problem. Recently however, delinquent payments are both especially prevalent and damaging. The Wall Street Journal recommends taking a few simple steps to prevent late payments before they become a problem.
Do your due diligence in the first place so you don’t need to lament the loss. Before she takes on a new client, Terri Olson, vice president of accounting for OE Construction Corp., does some research on credit-reporting agency Cortera’s Credit Exchange Web site. Her Arvada, Colo., company does subcontracting work for general contractors. For $3 per report, she can find out if the contractors pay on time or if not, whether payments are late by 30, 60 or 90 days. Also, she can get detailed information on the owner, the person in charge of finances and the volume of work they do. Before, she’d have to do the investigating herself, cold-calling other subcontractors that have worked with the primary contractor. “It gave me hope that there’s a way for me to have more control of whom we do business with, and how we do business with other companies,” Ms. Olson says. Other credit-reporting bureaus such as Dun & Bradstreet Inc. and PayNet Inc. offer solvency and delinquency reports to help you figure out the credit risk your business customers may pose.
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