Home Contact Micro Factoring

Tradesmen

Firstly, we recommend having a good credit control system. Systems are essential, particularly when you are dealing with more than just a handful of invoices. Sometimes plumbers, electricians and other tradesmen can have hundreds of invoices going out every month. Without a solid system in place, thousands of dollars can be lost. Providing goods and services

on credit is expensive. Secondly, your terms and conditions must include adding of collection fess to overdue accounts. This can include interest, and admin charges as well as the collection fees of the debt collection agency. These terms should be clearly outlined, either in contract form and/or on display, so that any potential customer has been informed before they engage your services. A seven day letter should be sent prior to lodging with a collection agency. This usually happens when the debt is between 60 and 90 days past due, although it can be sent at any time once the account is overdue.

Collecting information is also important and should be done thoroughly whenever credit is given. This can help with your own credit control as well as helping the debt collector. Full names (including middle names). Address. Date of birth. Copy of photo ID. All this helps to track people down and avoid confusion between people with similar names.

You should of course engage a reputable debt collection agency to provide debt collection services for you. The best way to get the most out of your debt collector is to provide them with the information they require and fully engage in their systems. A good agency will give you good advice which can save you thousands of dollars.

If your cash flow is being affected by the amount of money you have tied up in accounts receivable, you may also want to consider a solution such as invoice discounting which can help you maintain solid cashflow. Through our close association with The Interface Financial Group we can provide a package of services including providing short term working capital along with our credit control and debt collection services. This can be a very viable option for many tradesmen. For some business, we can set this system up in such a way that it costs you, our client, very little, or even nothing. The credit costs being passed on to your customers.

If you would like to discuss how we help tradesmen maintain good cash flow, click here.