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Avoiding Bad Debt In Business

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					Avoid Bad Debt
Bad debt in a simple word is any money you couldn’t recover back from your customer;
it is business cash that should have been paid to you after selling on credit to your own
customer in good faith believing that the payment would come after your customer had
made the sale but never returns. This kind of debt kills the business gradually, to some it
is just a way of life because they are used to it, they can only think this way because it
hasn’t affected them financially and luckily they haven’t had many of it. In businesses it
happens but when it is minimal it doesn’t really affects the business progress adversely.
         You need to really help your business by taking note of little things like this,
customers will always be needed but you must study their market behavior, their business
belief and their zeal to getting things done the right ways. When you realize that a certain
customer isn’t really responding well to sales you don’t need to book the customer plenty
of goods on credit, no matter the environment he resides. Believing alone in the location
of goods is not as acceptable to the business environment as the exchange of the goods
into cash. Money keeps the business moving, no business survive without money. Start
building human relationship with your customers and your residence communities
because they are the ones you need to get good returns for your hard work and financial
output. A guy once feel like impressing his boss, as a sales representative he contacted
some other customers without knowing their marketing strength and experience to work
along in distributing the company’s good and because the environment in which he
discovered these new set of customers is very business driven he felt he will definitely hit
his marketing target and have a lot to talk about with his boss and also get all the praises.
He went ahead distributing goods of course on credit to all his newly found sellers, and
thought all is moving well since he had disposed off all the goods. Little did he know that
the new boys weren’t his type? When the time came to give back the cash for all he sold
to the company, he met his nemesis because he couldn’t just persuade the boys to help
him get all the sales fund from debtors; he was under pressure and also gave his boss
worries and a lot to think about. He had to pay for his miscalculations all in the name of
trying to make a sales and also trying to impress his boss. This is a very short illustration,
yours might just be that you don’t always care to check the records of an existing
customers before issuing goods on credit, don’t make it a habit, you need to change it. It
is when you have a business that all works well any man without a business finds thing
hard, protect your business domain, think twice before eventually giving out goods on
credit to any one, it could mar your income and kill your business plans. Also find time to
read financial books on debt collection because most times what you need is to give
ultimatum to your sellers, maybe to test their ability or to just get them off the race if you
know they won’t be hard enough to run the race. Every business nowadays need hustlers
who could go extra length in getting a problem solved and also come with very fresh
ideas as to the progress of the business. It is never too late to readjust your credit facility
system policies, plan it well to reduce loss of huge money hanging on the bad debt
account every accounting year. Remember carrying out some surveying in some
designated areas you want to hit with your goods is not a bad ideal, take right steps. Be
smart.

				
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posted:11/18/2012
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