4 Strategies To Avoid Commercial Debt Collection Problems In Arizona
Arizona Fair Debt Collection Laws: How Can You Prevent Them?
Without solid cash flow, your business will be difficult to run and ultimately unsuccessful. No matter how hard you, your sales team, and your production crew work, if customers aren’t paying you on time as agreed, you will quickly find yourself with a very serious cash flow problem that can kill your business.
Most of the time, clients and customers are happy to pay their invoices on time, and a simple friendly reminder from your business is all that you’ll need in order to collect on outstanding bills that are owed to your company. But what do you do when you have a customer who is deliberately evasive and outright refuses to pay you what you are owed? How should you respond when a client withholds payment due to a dispute over the work or contract? These can be challenging situations for any business to work through, but for a small business that relies heavily on quick payment from customers, these circumstances can become urgent and overwhelming very quickly. That’s when you need an experienced Arizona commercial collections litigation lawyer who can help you understand your rights and options and be ready to pursue legal action when it’s needed.
4 Proactive Strategies To Help Avoid Commercial Collections Problems
Ideally, you’ll be able to deal with outstanding invoices privately in-house. There are four strategies your company can follow to make this happen as effectively as possible:
- Maintain good records: When you’re missing contracts, delivery confirmations, or other key documentation, you’ll struggle with effective debt collection. A business decision to reduce costs by limiting administrative staffing can actually backfire and cause poor recordkeeping that results in significant loss of income. Be sure you have sufficient staff, equipment, and internal procedures to maintain good records.
- Write a debt collection policy: One of the most common barriers to effectively collecting on invoices is failing to establish a clear credit and collections policy. This should be stated on each invoice that you send out. Once you’ve written the policy, be sure to enforce it.
- React immediately to late payments: It’s not uncommon for small businesses to ignore accounts receivable and avoid issuing final demands for payment until several months have passed. Unfortunately, the older the account, the less likely it will be paid in full. Your Arizona business attorney will probably recommend that you send accounts to collection within 60-90 days.
- Act aggressively to recover payment: Don’t ignore unpaid accounts and hope that you will eventually receive payment. Contact your attorney for guidance if the due date has passed, you have made several calls and emails to the customer, and you still have not received payment. Arizona commercial collections litigation lawyers have many tools available that can help them recover payment from delinquent customers on your behalf. Working with your attorney is one of the most effective ways to recover what you are owed.
How a Commercial Collections Lawyer Can Help Your Business
Your Arizona trademark attorney will suggest a variety of strategies to recoup your payment. First, a demand letter with a final invoice will be sent to the customer warning of legal action if the debt continues to be unpaid. An authoritative letter from a law firm is often all that is needed for a delinquent account to be paid, because many businesses will not want to deal with the time, embarrassment, and additional costs involved with going to court.
If there is no response to a demand letter, in-person meetings and settlement negotiations may take place. Preparation is equally important to negotiation as it is to litigation in court. Your Arizona commercial collections litigation lawyer will have the tools, skills, and expertise to do background work on the debtor. This may include verifying the financial health of the debtor and its ability to pay the debt, as well as discovering bank accounts and other assets such as real estate holdings, and even tracing assets that the debtor may be unwilling to disclose. In some cases, such as when a company is about to declare bankruptcy, it may be best to sell the debt to a collections agency.
If the customer and your Arizona franchise lawyer cannot reach a settlement, litigation in court may become necessary. This usually involves filing a lawsuit in civil court and seeking a judgment against the debtor to force payment of the delinquent bill. But an attorney’s work will continue even after winning the case, because the money must still be collected. Property liens, wage and other garnishments, bank levies, and even property foreclosures may need to be pursued and enforced to receive full payment. Your attorney will be at your side every step of the way.
Get Collections Help From a Skilled Business Attorney In Arizona
Is your business struggling to collect payment on overdue invoices? Get experienced help from Arizona’s most trusted business attorney, Denton Peterson Dunn. We can examine your situation and provide guidance to recover unpaid debts, whether they come from accounts receivable, real estate payments, or judgments from civil litigation. To start recovering your unpaid debts, schedule your confidential consultation with our attorneys today!