Helpful guide for business on how to handle overdue accounts, provided by the Better Business Bureau.

1. Guide to Collections Brought to you by the Tri-State B etter B usiness B ureau

2. John has recently started his own home repair business. He completed a job for the Jones family two weeks ago and has yet to receive any response to the invoice he sent to them.

3. This delinquent account is having a negative impact on his business’s cash flow, but John is still uncertain about how he should proceed. He doesn’t have a collections policy in place.

4. Cash flow is the lifeblood of a business, and an effective collection policy is essential to keeping the money rolling in.

5. Use it or lose it . It's a fact: The longer you wait, the less money you'll collect. Begin your collections procedure as soon as you notice a delinquent account. Start calling customers the day their invoice becomes past due, and call them every day until the bill is paid.

6. Send a letter . Develop a template for each letter so you can easily fill in the blanks and send it out when an invoice is 30, 60 and 90 days past due.

8. 5. If you still have not heard back from the client, and are confident that you do not simply have a problem with their contact information, call a collection agency. If you'd rather be writing proposals than collection letters, there are small business collection agencies that will take on debts for as little as $20 each. Such companies are typically paid on commission -- usually around one-third of the collected amount, though rates vary.

9. Bend, don't break . If a good customer is occasionally late with a payment, be flexible. Do continue to call them to request payment, and set up a payment plan if necessary.

10. If one of your debtors files for bankruptcy: Consult a lawyer immediately and stop all collection efforts. Depending on the type of bankruptcy, you may still be able to recover some or all of the debt.

11. Whether you are looking to improve your existing strategy or starting from scratch, consider the preceding tips for implementing a successful policy. And Remember, even the best policy is worthless if you don’t follow It then necessary.

12. This presentation was brought to you by: The Tri-state B etter b usiness b ureau. www.evansville.bbb.org 5401 Vogel Road Evansville, IN 47715 812-473-0202 or 800-359-0979