B2B Collections: How to Convert Aging Receivables to Cash

If you've been putting off the headache of collections, you've likely also been asking, "how can I improve my cash flow?" The two go hand-in-hand. When you're not following up on invoices that are getting older, your chances of collecting on them go down.  That means you're working for no pay and that's no good. 

Instead, use these B2B collections steps to convert aging receivables and improve cash flow.

How to Manage Delinquent Customers in Business

If your business sends invoices or bills on credit or at recurring intervals, you likely have customers who pay late or not at all.  Delinquent customer accounts can affect everything from paying business expenses to destroying business relationships. Customers may be paying late due to a number of reasons, including lost invoices, expired credit cards, or the inability to pay. Instead of taking it personally, your business can follow these tips to recover the account in a professional manner. 

Here's how to manage delinquent customers in business.

Tips for Staying Cool 😎 Even When They Owe You Money 😡

One of the top stressors of Americans is their financial well-being. Take into account owning your own consulting business, starting a software company or freelance career, and that stress is exponential.  It's one thing to lack personal financial literacy but when your business and livelihood are also at stake, the anxiety can leave you paralyzed. 

Now imagine that you have to contact a customer that's behind on payments. 😲

Before you pick up the phone or send that email, take a moment to review these tips for keeping your cool when they owe you money. 

How the Job Market Is Affecting Client Invoice Payments

Employers are struggling with finding workers even though COVID restrictions are being lifted across the country.  According to a recent report, 42% of small business owners were unable to fill job openings and 91% were unable to find qualified applicants.  These challenges are also affecting the work that's getting done within businesses too. 

Here's how the job market is affecting client invoice payments.

Do This For Successful Business Debt Collections

Collecting past due debts from your customers and clients is an unfortunate part of the accounts receivable process. It's 'unfortunate' because not every customer will pay on time but it doesn't have to be contentious or ugly.  Your client will be aware of what they owe, when they owe and how to pay via your contract agreement. But even beyond that, there are steps you can take to ensure payment from your collections efforts. 

Follow these steps for successful business debt collections.

Are Your Client Payments Still Affected by the COVID-19 Pandemic?

Over the course of 2020, businesses had to make adjustments to survive. For some, it was a matter of moving employees to remote work or pivoting to a new business strategy. For others, the effect of COVID-19 meant halting plans, shutting down, or laying off employees.  Manufacturers were unable to move products due to global supply chain challenges and small-to-medium businesses faced delayed payments. With states lifting mandates and vaccines in arms, there seems to be a light at the end of the tunnel. 

Are your client payments still affected by the COVID-19 pandemic?

How Effective is Your Business' Accounts Receivable Department?

Whether you're managing a growing accounts receivable department or you're an A/R department of one, it's important to measure the effectiveness of your efforts. Is your A/R team doing all of the right things to get paid consistently and on time?  Read further to evaluate your department's effectiveness and considerations to get even better. 

How effective is your business' accounts receivable department?

What Types of Businesses Use Commercial Debt Recovery?

Commercial debt recovery, also called corporate collections or B2B debt collections, is used specifically to recover delinquent business customer accounts.  Not to be confused with consumer debt collections where the delinquent account holder is an individual, commercial debts refer only to businesses. To clear up any confusion, we'll cover what's different and why. 

What types of businesses use commercial debt recovery?

How to Collect from Non-Paying SaaS Customers

Setting up any sort of retainer or regular payments seems to be a great business model. Subscribers to software-as-a-service are auto-billed or auto-renewed regularly, funding any updates to the product and keeping cash flowing. The challenges arise with missed payments or non-paying customers.

Is there a good way to collect from non-paying SaaS customers?

How Long Can a Collection Agency Attempt to Collect Business Debts?

If your business has sent bad debt accounts off to a collections agency, you likely have questions about recovering that debt.  Typically, commercial collections agencies only charge a fee if they're able to collect.  The agency should also be transparent about the collections process and the documentation along the way.  But you may also be wondering how long they'll work on your behalf before you take the case to court.

How Long Can a Collection Agency Attempt to Collect Business Debts?