How have you been able to avoid bad debt in business?

[Nomad]

I have owned brick and mortar business in the past and one of my businesses collapsed due to bad debt. From my experience of owning a business and managing a business, and witnessing a business collapse due to bad debt, now I know what you can do to handle debt. You need to minimize expenses first.

 

[kayode10]

The best way to tackle bad debt is to have a plan on ground to tackle it. It is very important to always money to the cash flow of your business and come up with a plan and on how to get rid of bad debt from your business capital. You can set aside a portion of your revenue for the payoff of the bad debt as soon as possible. You can hire a professional CPA to design accounting record to tackle this issue.

 

[Asad Masood]

Mostly new businessman are effected badly by bad debts because he doesn't have skills to utilize such debt. Practice as makes a man perfect so once to start new business on basis of debt one should be able to make him perfect in his business work.

 

[mayreeh38]

The bad debt you are referring to,is it when customers owe you and refuses to pay? Or when you go into debt just to save your business and have more goods to be sold? Well, if it the first one,you can set your policy on goods purchased, don't sell them on credit.

 

[Papikarl]

It is very important for newly established business to avoid bad debt at all cost
Bad debt can have a detrimental impact on a business, putting its survival at serious risk. Majority of startups will face financial challenges at the early stage in business and that can lead to early closure of once promising business.

what is the best way to reduce bad debt?

Debts is normal with any business, infact there is no business that doesn't have debtors, but how to manage it is the most important thing, know who you give credits to, be sure that they will pay on time as at when due

 

[maventiger]

Debts is normal with any business, infact there is no business that doesn't have debtors, but how to manage it is the most important thing, know who you give credits to, be sure that they will pay on time as at when due

@Papikarl Even financial institutions especially Deposit Money Banks still record Bad Debt after they must have check the credit worthiness of the business before giving out loan.

 

[WhiteHouse]

Focus on YOUR DEBT

When you comprehend your debt, you need to choose which one you will square away first. My recommendation is to assault the ones that are the littlest in aggregate sum to be reimbursed. Utilizing this technique, you will see impacts quicker, and you will get more discretionary cashflow in no time.

 

[Abelcairo43]

Once you know the financial capacity of the business nothing should make you incure debt on the business. You wouldn't want to go beyond the capability of the business because if you do the the debt will set in and this not good for the sustainability of the business.

 

[Shahidhussain480]

It’s possible to reduce the risk of bad debt by setting up effective policies and procedures around credit management, and making sure strong internal control systems are in place. This applies to taking on new customers as well as with regard to your existing customer base.

 

[Kelly5]

It is not a good practice to start a new business and begin to give credits fro your products to people. It may seem harsh for those who think you must and aught to give them credits all the time. This will run your business down before you will even know it

 

[Eodine]

The effect of bad debt on a business can be very grave especially for a start up as it requires a lot of capital to still run I remember a time like that when a friend had to borrow an interest free loan from his parents to continue a business.

 

[Maiira]

Credit reporting companies can provide a financial health check on your clients, be they a business or an individual, and should be mandatory in any onboarding strategy. It’s important, too, to know who you are going into business with. Be sure to speak with past suppliers and industry colleagues so you ensure you have the full picture.

 

[bhennie]

Our task at Debt Recoveries Australia is to collect debts. However, as we come into contact with a lot of credit departments and accounts receivable systems and processes, we also get to see how debts come about in the first place and how they can be avoided.
Wouldn’t it be great to prevent all that bad debt from happening in the first place? But how? What tools should you put in place at the beginning to minimise outstanding debts?

 

[Kehinde]

Choose Your Clients Carefully. ...
Get Tighter Control. ...
Money Upfront. ...
Set Your Payment Terms and Penalties. ...
Strict Processes for Payment and Follow Up. ...
Stick to Your Terms. ...
Fix Disputes Quickly. ...
Use Debt Collectors or Lawyers.

 

[Jumoke12]

It is very important for newly established business to avoid bad debt at all cost
Bad debt can have a detrimental impact on a business, putting its survival at serious risk. Majority of startups will face financial challenges at the early stage in business and that can lead to early closure of once promising business.

what is the best way to reduce bad debt?

There are many ways to reduce bad debts or even avoid them. Speak to your clients and let them know that there is a policy now that is against bad debts, give them discounts on purchase made and guve them the deadline of payment. it will work and help your company reduce bad debts

 

[Psalmseen]

Bad debt is simply irrecoverable debt of a Company owed by its customers. Bad debt has a bad effect on the well doing of an organization. It is at all no doubt that a company that has lots of bad debts can not grow. Rather, it will keep failing over time and the company will be covering up with those bad debts with her income

Post automatically merged: Feb 11, 2021

Bad debt is simply irrecoverable debt of a Company owed by its customers. Bad debt has a bad effect on the well doing of an organization. It is at all no doubt that a company that has lots of bad debts can not grow. Rather, it will keep failing over time and the company will be covering up with those bad debts with her income

 

[Setho]

I tend to love businesses that are attached to passion where I do not have to spend a lot. I normally go for hundred dollar startups so I usually do not even need to tale debts or loans in my business. I avoid it at all cost.

 

[Adetayo100]

You can avoid bad debt in business by sustaining your business and not spending unnecessary money or expenses, you also need to cut down on your staff and also reduce other cost associated with running the business.

 

[solomonmali]

It’s key to always set your payment terms in writing with each client. This creates a clear understanding of the conditions of the relationship but it also protects your business – these terms should detail that any costs associated with recovering outstanding invoices fall squarely with the client.

 

[Adetayo100]

You can avoid bad debt in business by sustaining your business and not spending unnecessary money or expenses, you also need to cut down on your staff and also reduce other cost associated with running the business.

Post automatically merged: Feb 13, 2021

You can avoid bad debt in business by sustaining your business and not spending unnecessary money or expenses, you also need to cut down on your staff and also reduce other cost associated with running the business.