Small business debt in Australia
Current surveys show that small businesses are owed over $10 billion; of this amount, bad debts account for over 60% of this outstanding amount. Surveys conducted by the Commonwealth bank of businesses with turnovers up to $2 million shows the average debt owed to each business is around $20,000 and rising. Of all the Businesses surveyed, 60% agreed that late payments are “standard practice” and the other 40% are holding on to payments to preserve their own cash flow. Queensland Businesses are shown to be doing marginally worse with a total of 66% of all debts owed falling into the overdue category.
What does this actually mean?
This research reflects a recent report from Dun & Bradstreet (D&B), which shows that 62% of business accounts were settled an average of 53 days or later in December. While this shows an Improvement from the post-global financial crisis high of around 56 days, it still underlines an increase in accounts being paid outside of standard payment terms. The figures of small business debt clearly point out a direct need for prompt action to recover outstanding monies owed as well as an increased need to grow cash flow and secure funds.
What you can do to collect bad debt?
Before enlisting the help of an expert debt collection, like Profcoll, there are tips you can take to resolve the bad debt. If you have bad debt have you can try these tips to handle customers with outstanding accounts:
- Avoid harassing people with outstanding accounts: As a business owner, you probably don’t need to reminded not to harass customers, but when it comes to collecting debt, it’s a good legal practice as well. If your actions are ruled harassment then you could be facing a legal challenge. If you decide to call your debtors, make sure it no more than once a day.
- Keep calls short: When you call customers, make sure you keep calls short. Stick to one central message, short and formal. Avoid attacking your customer, or making threats. Remain calm during the conversation and avoid become defensive.
- Write letters: In addition to calling them, you can also write a demand letter to your customer who owes you money. You should also save copies of the letters because if you do decide to enlist the help of a debt collection agency, they could be useful.
- Hire a debt collection agency: That’s us! Profcoll is an expert debt collection agency that can help recover your bad debt. You wouldn’t do your own wiring, so don’t leave your debt collection DIY, instead enlist the help of the experts. When you’ve exhausted over avenues, like contracting them yourself, then it’s time to turn to debt collection. We know exactly how to legally recover your debt, and you can get back to what you do best.
Why Profcoll for small business debt?
Profcoll is an expert debt collection agency that is ready to help recover your debt. Bad debt is code for cash that should be in your business! So, don’t leave it hanging, pursue your bad debt with the help of Profcoll. Trust over 20 years experience in the industry and expert account managers that will handle every step of your case. Whether you live in Brisbane, Melbourne, Sydney or Perth, you can enlist the help of Profcoll to recover these pesky debts. Get your cash back in the back in your business where it belongs.
To discuss ways we can help you do this please call our Sales Manager Aaron Bey on 0417 030 761 to book an appointment now. If you want to stay in touch with Profcoll, follow us on Facebook and stay tuned ot our blog for the latest tips and tricks on debt collection and small business debt.