Your business may have unpaid debts from many different sources, including consumers and businesses of all sizes and structures. The approach to successfully collecting a debt should vary depending on who the debtor may be. Debts owed by small business owners may especially require a particular approach to both receive payment and keep the client.
Does a small business owe you money and refuse to pay? Contact Weisblatt Law Firm at (713) 666-1981 for proven guidance and debt collection strategies.
Sole proprietors and other small business owners know that profits can vary widely from one month to the next. Many factors can suddenly affect the business’s bottom line and can make it difficult or impossible to cover all debts and expenses for that month. However, this does not necessarily mean that the small business will never be able to pay on debts, so you do not want to automatically cancel your contracts and lose a client upon non-payment. Instead, you should have someone with experience in small business B2B collections employ creative techniques to obtain payment, as the small business may simply need some flexibility in order to pay you.
Seek Assistance from Someone Who Understands Small Businesses
As a business owner, your focus should be on operations and not on seeking payments from your business clients. It is important to have someone handling your B2B debt collections who understands the nature and needs of your small business clients. It is a good idea to retain a business attorney who also has experience in B2B collections. An attorney who advises small businesses on many different legal matters from the start to the end of their operations will have a firsthand understanding of the nature of this type of debtor. This can allow for specially tailored collection methods, payment arrangements, and more to help you receive the payments you are owed.
Debt Collection Methods
When you hire an experienced B2B collections lawyer, you get the peace of mind that what can be done is being done. An attorney will use every effective method to recover your debt in as timely a manner as possible.
Continual Communication
You should regularly communicate with the business about the debt but should do so in as professional a manner as possible. Refrain from harassment or the appearance of such. The continual communication is to demonstrate that you have engaged in continual debt collection efforts. As such, your communications should be limited to key information, including:
- How the debt was incurred
- The amount of the debt owed
- How long the debt has been delinquent or in default
- Consequences of continued non-payment.
You should also provide clear instructions on how to satisfy the debt or delinquency or how to bring the account up to date if that is an option. B2B debt collection attorneys know how to manage your communications with small business debtors in a manner that protects your legal and financial interests and informs the buyer of their obligations.
Debt Settlement
Depending on the circumstances of the debt, you may find it more beneficial in the long run to settle with a small business debtor. Settling may lead to various results, including:
- Adjusted payment terms
- Exchange of goods and services to cover some or all of the debt
- Lump sum settlement payment.
Although you may not receive the full original amount of the agreement now in default, you can still recoup some sort of consideration — and often, getting a portion right away is more beneficial than waiting and hoping to get the full amount.
Collection Agency or Lawyer
Hiring a collection agency is an option for collecting small business debt. However, collection agencies are limited in the services they can provide. For example, under no circumstances can a collection agency give legal guidance or counsel when legal issues arise. Attorneys, on the other hand, represent their business clients in collections matters and are fully authorized to guide and counsel clients’ every step.
Keep in mind that small business debts in the hundreds of dollars may be more suited to collection agencies. These agencies thrive off of the collection of multiple low-dollar (comparatively) debts. B2B collection attorneys, on the other hand, typically have far fewer clients and work with much higher amounts of debt.
If you are deciding whether to hire a collection agency or a B2B attorney, strongly consider contacting Weisblatt Law Firm for a free phone consultation and guidance. A preliminary case review will help you make an appropriate choice.
B2B debt collection attorney Andrew Weisblatt provides effective debt collection strategies that work.
File a Lawsuit
If other methods of collecting the debt have failed, your business may want to consider seeking a court judgment for the amount of the debt. Hiring an experienced B2B debt collection attorney to file a lawsuit is perhaps the most effective method of compelling a debtor business to pay what it owes. Court judgments come with teeth and effective debt-collection powers. However, they must be filed within four years of the breach to meet the statute of limitations requirement.
Once your attorney takes over, you will have more time and head space to focus on business operations instead of collecting debt. While you are tending to your company, your attorney will prepare and file all necessary paperwork and documents and ensure service of process.
After filing a lawsuit, you may find the debtor more amenable to settlement negotiations. Often, agreements are reached soon after papers are served. During these negotiations, the skill and experience of a seasoned B2B debt collection attorney are valuable and work to procure favorable settlement terms.
Consult With a Houston B2B Collections Lawyer for Assistance
Andrew Weisblatt of the Weisblatt Law Firm in Houston has been advising all types of businesses from large corporations to one-owner operations for many years. He understands the unique approach needed for each type of B2B debtor that you have to ensure the most successful collection results possible.
If you have debts to collect from a small business, do not hesitate to contact Weisblatt Law Firm for a free phone consultation. Take the next step toward recovery of your debt. Call (713) 666-1981 today.
Attorney Andrew Weisblatt
Mr. Weisblatt has practiced continuously since becoming licensed in 1992 and has represented businesses ranging in size from one person start-up ventures to multi-national corporations employing hundreds of people in multiple countries. From 2005 through 2009 Mr. Weisblatt was in-house counsel and chief operating officer of a multi-national corporation in the steel products industry. That in-house position provided valuable insight into how businesses work and what they actually need from their lawyers – both in-house and outside counsel. Attorney Bio
