For businesses, the economic uncertainties can sometimes look bleak – with the constant outpouring in news stories from ‘Brexit’ to the ‘fierce competition’ that is being faced by the high street.
However, what most businesses fail to understand, or get to grips with, is the importance of cash flow in this modern day and age.
All too often, the importance of cash flow is ignored and has been coined by many commentators as the silent assassin of small to medium enterprises. The statistics alone paint a stark image, which has been encapsulated by a recent report that stated more ‘than 50,000 small firms are closing every year, being owed £14.2 billion in unpaid debt’.
It is therefore critical that businesses ensure that they take the necessary steps to ensure that they do not become a part of this growing trend.
Some of the ways in which a business can become proactive in owning their bad debts is by setting up a robust system, which can not only track their figures but allows them to effectively manage against the impact of late payers.
To enable this, it is essential that business look to their Accountants and Solicitors to ensure that they are equipped with the right tools and knowledge.
As Solicitors we are often tasked with securing bad debts and mitigating against late payers for businesses across the spectrum. Experts in this area of law can assist you in many ways through:
- Arranging and negotiating schedules of payments for customers claiming financial difficulties;
- Knowing whether to claim interest and debt recovery costs under the Late Payment of Commercial Debt Regulations 2002;
- Sending a letter of action, warning of your intention to sue for outstanding debts;
- Assessing whether it is worth taking legal action (e.g. what are the time-scales, costs and can the customer pay?);
- Attempting to negotiate an agreed settlement, rather than going to court.
- Enforcing payments from obtained Court Judgements.
The reality is debtors will often not directly respond to businesses’ requests for payment and it often takes a third-party’s robust approach to find the resolution. The real question is, therefore, whether your business can afford not to have a robust system in place which is aligned essential partners.
We, at Liberty Law Solicitors, are experienced business partners in the field of debt recovery and can assist your businesses with late payers and all types of outstanding debts.