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Wednesday
Sep182002

Collect the Money You Are Owed

"A sale is not a sale until you collect the money!"

Even in the best of times, collecting the money you are owed can be a challenge. Now that the economic climate has slowed down for a number of industries and countless businesses, collecting your money can be an even greater challenge.

Collection practices that may have worked for you during good times can actually make it more difficult to collect during slow times. Allowing customers to pay 120 days out might have worked when the economy was booming but now the customer may think it is okay to use your receivables to finance their business. Worse yet, if that customer later goes bankrupt, you may need to return payments that you worked hard to collect to the bankruptcy trustee as preferential transfers.

If there is sufficient interest, I will conduct a seminar on what to do when a customer files bankruptcy. If you are interested, please send a reply and we will make sure to notify you of the seminar date and time.

In the meantime, there are preventative strategies you can employ to:

(1) Speed up the collection of your accounts.
(2) Prevent collection problems.
(3) Reduce the amount you extend to problem accounts.
(4) Prevent problems with bankruptcy trustees.

The strategies I recommend to you, however, are not my strategies, instead, they were published in a recent issue of INC magazine.

For the first time, legal briefs is linking to an article written by someone else. In this case, it is entirely appropriate to do so. The article is outstanding. If you follow its recommendations, you will have far fewer collection problems to discuss with your attorney. The link to the article is set out below.

http://www.inc.com/magazine/20020901/24541.html

Keep collecting the money that you are owed so that you can pay your employees and pay your vendors so that we can get our economy moving again.

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