How to tackle debt collection during the festive season

As the year draws to a close, it’s important to prioritise debt collection to safeguard your cash flow heading into January.

December’s shortened work weeks, holiday distractions, and seasonal illnesses can make it a tricky time to manage overdue invoices. Coupled with the pressures your own business may face, dedicating time to effective debt collection can feel overwhelming.

To help you navigate this challenging period, here are some practical tips:

Stay connected with debtors

Maintaining open communication with your customers is key. Proactively remind them of your payment terms and share any changes to your operating hours or billing processes during the festive season.

If you’re visiting customers to express gratitude for their business, take the opportunity to subtly address outstanding invoices or review their credit standing. These conversations, handled tactfully, can be productive without feeling pushy.

Be proactive and plan ahead

Festive distractions can become convenient excuses for delayed payments. To counter this, reach out early to follow up on overdue accounts or those nearing their due date. Acting promptly increases your chances of engaging with decision-makers before they are swamped by end-of-year priorities.

For small business owners or sole traders, the temptation to divert funds toward personal festivities or holidays could exacerbate payment delays. By staying ahead of potential issues, you can identify customers who may be showing signs of financial strain.

Balance firmness with festive cheer

While it’s essential to address overdue debt, keep in mind that December can be tough for many businesses. Seasonal closures, reduced staffing, and slower sales might mean they are also waiting for payments from their own clients.

Show goodwill in your business relationships. If a debtor is a valuable customer facing temporary difficulties, consider offering flexible settlement terms, such as instalment payments. This approach could help you recover some funds while maintaining a positive partnership.

Take swift action

If you suspect a debt may go unpaid, don’t delay. The longer you wait, the higher the risk that your debtor’s financial situation worsens, leaving you at the back of the creditor queue. Address the issue promptly to protect your position.

Consider professional debt collection support

If your in-house efforts are not yielding results, it might be time to enlist professional help. A debt collection agency can efficiently manage overdue accounts, especially during busy periods like Christmas.

At Controlaccount, our expert team is dedicated to delivering positive outcomes while preserving your reputation and customer relationships. We handle debt collection with diligence, sensitivity, and professionalism.

End the year on a strong financial footing by addressing overdue debts now - your cash flow will thank you come January! We can assist you to navigate this critical aspect of business management, making sure you’re paid on time and in full, to help you go into the new year with confidence.