How can I protect my business from bad debts?

We have listed below some key points to consider to help protect your business from bad debts:

• Consider carefully before you give credit to customers /clients. I appreciate that in order to remain competitive this is a difficult decision but not as difficult as providing goods / services and not getting paid.
• Directors may offer personal guarantees that could be relied on should the company not be able to pay, however, be wary of guarantees too freely given as this may be a reflection of the director having little or nothing to lose.
• Given the unprecedented trading conditions it is likely that customers / clients might look to delay payments to suppliers. Working with such customers / suppliers to get payments by instalments is a sensible option and improves your cash flow / limits your exposure.
• Review what credit insurance you have in place - you are unlikely to be able to secure more insurance in the current climate.
• Review retention of title clauses for effectiveness and you are following the procedure to the letter. If you need to rely on the clause then you will need to be able to demonstrate that you communicated in the terms in advance of the supply. 
• For more information please contact the Business Restructuirng and Insolvency Team by submitting an enquiry.