Many businesses find themselves in trouble. Sadly, most will not talk to their professional advisors until it is almost too late to think about a rescue - so you may well be called on to advise on insolvency.
Take a look at the checklist below: If a customer regularly displays one or more of these early warning signs, you could be well advised to reduce your exposure if possible. But, the first step should be to talk to your customer and listen to what they have to say, maybe things are not what they seem - or maybe you could help.
Identifying problem customers as early as possible should be a standard part of your monthly financial management routine. Start by looking out for any of the following symptoms:
It's always best to speak to your customer before you take drastic action - do as you would be done by: You may be in a position to help them resolve a crisis - that way you get to keep a customer (and probably a loyal one).
However, if the debtor appears evasive or unwilling to talk or explain their position – take action to reduce your risk..
These are only warning signs, not confirmation of a real problem, But, they should never, ever be ignored
By realising that problems are looming, you have already taken the first step; if you haven't spoken to one of our specialists, you should: Contact us now and we will respond as soon as we can.
Act quickly if you are facing financial difficulties - a Company Voluntary Arrangement or an Individual Voluntary Arrangement may rescue your business and be a solution to mounting debts, depending on the circumstances. If you think that a customer is experiencing operating or financial difficulties that may leave you with a potential bad debt, you should seek professional advice, and find out more about the action you can take. See "Protecting Your Interests" for more details about where you stand.
A Hodgsons' licensed insolvency practitioner can advise you - a first consultation is always free. Save yourself a lot of worry and money. Contact us now for more details.