Speed Up Debt Recovery And Boost Cash Flow

Muckle LLP’s debt recovery team, ranked top in the North by Legal 500 UK, has some New Year’s resolutions that can help businesses get paid quicker and improve cash flow in 2020.

he gifts have long since been unwrapped. The stockings ransacked. The dinner dispensed. Now you’re getting back down to business, but is your list of debtors larger than you’d like post Christmas?

January is often a quieter month than many, so if your corporate customers owe you money, now is a great time to tighten up your debt recovery, call in your debts and start as you mean to go on in 2020.

Why is debt recovery so important?

It probably comes as no surprise that most organisations hold onto payments longer than they should. In fact a recent study found that 92% of businesses admit to paying late. So whatever organisations you supply, chances are, some of them have aged debt that is seriously impacting your bottom line.

The sad fact is that an estimated 50,000 businesses per year collapse due to late payments in the UK, so debt really has a serious impact on your ability to function properly. With over 25 years’ experience, Beverley Oliver, debt recovery manager at Muckle LLP, has helped hundreds of businesses get paid. Legal 500 UK recently acknowledged her success in helping businesses recover debts by recognising her as one of the North’s leading specialists in this field.

Beverley is also vice-chairman of the North East branch of the Chartered Institute of Credit Managers. Here she shares some golden advice that will help make sure your cash isn’t languishing in your customers’ coffers for much longer than it should.

New Year’s resolutions for recovering cash quicker

1. Tighten up your terms

Make sure that your terms and conditions have a late payment clause and threaten to use it in your chasing letters.

2. Spot the signs

Look out for delaying tactics – excuses like “I never received your bill”, “the company name is misspelt on the invoice” and “our director is away and she needs to sign-off payment”. While these might be genuine, they are also a red flag.

3. Ensure your paperwork is right

If your customer has a purchase order number, ensure it is correct and on your invoices. Some businesses will delay payment because PO numbers aren’t right.

4. Know who you are dealing with

Make sure you know the exact name and legal identity of your customer. You can also run a credit check on your client or customer before you start working with them and make sure that they have the means to pay. Failure to do so could result in late payments that damage your business.

5. Start early

Time is everything, so pursue the debt sooner than later. The older the debt, the more difficult it is to collect.

What if the debt is old?

If you have a business-to-business debt that is over 90 days old, you can always send it to Muckle. They can recover your debt on a “no recovery, no fee” basis, and you will have one of the North’s top debt recovery team’s supporting for your business. Alternatively, they offer to handle your case for a fixed fee of £50 (+ VAT) if that is easier and your debt is less than £15,000.

89% success rate on recovering debts

Based in Newcastle upon Tyne, the debt recovery team at Muckle LLP acts for businesses across the North East and beyond. They have an extensive range of clients, from individuals to large companies and public sector organisations.

Expect a hands on, personal approach to businessto-business debt collection, which is key to its 89% average success rate. As well as Beverley, the team includes restructuring and insolvency partner Kelly Jordan, who Legal 500 UK also ranks as one of the region’s leading specialists.

The team also works closely with Muckle LLP’s other experts and, with lawyers in virtually every area of commercial law, you can rely on getting the support you need if things get more complicated.