It will be increasingly likely that invoices will not be paid on time or will be disputed in some form and while there may be many reasons offered for the refusal to pay, the commercial effect is the same adverse cashflow.
Accordingly, managing your bad debts and resolving any commercial disputes promptly will be beneficial to your cashflow and therefore helpful to your business during these difficult times.
Every debt or dispute is different, but our experience is that they can be dealt with by:
- good communication
- supportive documentation; and
- clear escalation through to recovery action.
Keep talking to those who aren’t paying, to see if they can’t pay or won’t pay and keep a clear record of why there is a delay in payment.
Of course, the flip side to this is that when cash is tight, good communication is likely to buy you the additional time to settle invoices owed by you and, in these turbulent times, offers to pay in instalments may be enough to avoid enforcement action being taken against you.
Cash is king, after all.
Our commercial disputes team is here if you need to escalate a dispute or need to respond to a claim and we are happy to discuss all options by telephone 023 8071 8000.