In today's world, maintaining a good reputation is vital to the success of your business. Word can spread on social media at lightning speed and your brand integrity can be trashed before you've had a chance to exercise your right to respond.
That means it's more important than ever to protect your brand reputation in every way possible, and you need to be particularly careful when you’re dealing with the thorny issue of unpaid debts.
Every business has the right to expect to be paid for goods or services supplied, so is failing to chase up unpaid debts ever a good commercial option? At the very least, it could create cashflow problems. At the worst, it could put your finances under extreme pressure and your business could be at risk of becoming insolvent.
That said, while you may be perfectly justified in chasing a debtor for money you're rightly owed, it always has to be done with sensitivity, professionalism and legal propriety. To protect your brand integrity, it's vital that you don't appear to be unduly aggressive or over-zealous in your approach.
What if your own efforts to recover a debt fail?
Having tried unsuccessfully to persuade a debtor to pay up, you may feel it's time to get professional help. For many businesses this will be a last resort after they've given the customer ample notice, which may be several months or perhaps even more than a year.
If you do decide to go ahead and use a debt collection agency, there's a key question to ask yourself. Will you be putting your reputation at risk? The answer is that you don't have to. And here's why...
A good debt collection agency will protect your reputation
The golden rule is to do your homework. That way you can make sure you choose a debt collection agency that prides itself on acting with integrity and professionalism to safeguard your reputation. Find out about their working methods and check out any online reviews or feedback. Sit down with them and discuss your concerns to get the reassurance you need.
Just mentioning their name might be enough
Once you've established a relationship with a debt collection agency, it's worth setting up a standard 'final notice' letter for problem debtors that says you'll now be passing the debt to the agency for collection. In some cases, this might be enough to do the trick without the agency taking any action and you won't incur any charges.
Doing nothing could be bad for your reputation
Reputation is not just about customer goodwill. If you take no action against defaulting debtors, other customers (or competitors) could see this as a sign of weakness. If so, it may not just be your cashflow that takes a hit. The perception of your business could also be damaged. For some businesses, that won't be so much of a problem. However, many others, such as independent schools, rely on their reputation for robust financial processes to ensure fees are paid on time. That means they'll be keen to avoid word getting around that they're anything less than diligent in chasing overdue debts.
You can rely on us
At Redwood Collections, we understand how important it is to safeguard your reputation and your customer relationships. We're focused on getting results and recovering monies you're owed, but we're also committed to operating with sensitivity, professionalism and full legal compliance, so you can take full advantage of our expertise and experience with complete peace of mind. Our aim is simple: to help your business Grow Stronger.
Email us at info@redwoodcollections.com.
