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

[Felixko]

i guess you are talking about customer owing you as the debt. to me there should be rule and regulation attach to a credited good. in this there should also be validation of the period of the debt by a customer.

 

[eenya00]

I don't believe that someone can easily overcome bad debts in a business, except your business is about to start on a very big note, that reduces the rate of borrowing from your business.

 

[Donkiz]

To avoid bad debts in your business, especially if it's a new business, is to avoid borrowing or collecting loan. You can collect loan to expand your business only when the business is fully grounded and has started making profit, but if you take loan to start up a new business, it might affect the business negatively and can lead to the collapse of the business.

 

[Eodine]

It is true that the effect of bad debt can be very detrimental so it's best to avoid bad debt especially start ups as they can cause failure for the business but it's also good to plan for bad debts because sometimes it can be unavoidable.

 

[gnasrullah53]

In the new business every one has to avoid from bad debits.in the new business every one has a chance to establish their business because they invest all their money in the business.so they should make some policies in which they utilized their business and keep away from all kinds of debts which makes them successful in business.

 

[unhappy triad]

Risk is part of business. It is a fundamental part of it. This doesn't mean though that one should take any risk that comes by. Risks in business has to be projected properly calculated,odds weighed and the possible yield estimated before jumping into it

 

[Hdre3m3n]

The very important something that every business must put into consideration is the Issue of bad debt because every business must be able to calculate the income and expenses of the business inorder to come to the very aggregate balance of the business.

 

[Adventurer]

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?

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

Nice, I see lots of people say it is bad to take loans to start up a business but the truth is some people have no choice, I have seen lots of businesses start up with loans and are doing well, as long as they have good strategies like financial control to ensure debts are paid.

 

[Grant]

Planning and budgeting. It's not easy by any means, but when you budget everything and plan things out, you do a lot better. As well, take things slow, don't rush into anything you don't understand.

And let it be known, that you will fail from time to time, that's a given. We all fail in this business once in a while. It's how we pick ourselves back up, and do the work that is needed to make things right. Starting a business is a long process, often with pitfalls and mistakes. But, as long as you're smart and patient, you'll do just fine.

 

[Sincerem]

Avoid unnecessary spending spree, mismanagement of funds. Try to meet customers demand, have a database for your business initiative. That will help you to keep every sales, profit you've made in your business. Then you can decide to save it or reinvest your profit to carry your business higher.

 

[Suba]

Baddebt occurs due to sales of goods, which are written off or eliminated and recorded as baddebt expenses which will reduce account receivables, so to reduce bad debt we have to select customers who buy with debt, as well as limit the number of accounts receivable.

 

[Nomad]

In order to avoid bad debt, you might have to take unpopular and harsh decision such as cutting workforce, cutting staff incentive and salary, selling assets, selling shares, etc. These decision may not be liked, but will ultimately help your business survive. This method has helped me.

 

[Kingsley]

Baddebt is somewhat different from irrecoverable debt, bad debt are monies or asset that seem difficult to recover due to somany factors like the death of a customer or bankruptcy of the customer.while irrecoverable debt should be written off. So the best way to avid it according to me is to maintain a steady policy of cash payment and aviod giving credit facility.

 

[Damismiling]

Bad debt is an enemy of the business, they will ruin down the business if not properly managed, so what I would suggest us that as a business ensure you never give room for debt at all, no matter what

 

[Lawal]

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?

The best way to avoid bad debts in a business organization is through meeting the needs and demands of the customers. This will avoid running the business at loss. Running at loss in a business can lead to bad debt

 

[maventiger]

The best way to avoid bad debts in a business organization is through meeting the needs and demands of the customers. This will avoid running the business at loss. Running at loss in a business can lead to bad debt

I very much understand you @Lawal. Avoiding bad debt at an early stage of the business is very important for startups in other to be able to achieve the management goals. When a business is running at loss it becomes nearly impossible to attract investors.

 

[Shigobad2020]

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?

Debt in business world is unavoidable but bad debt can be avoided if you have another option, some people just decided to borrow and Loan money anywhere and anytime they sees an opportunity without taking the business into consideration.

 

[Josemendez]

First is to start a business after all the needed resources is already down , then you work towards ensuring that since the business has not started yielding profits , unnecessary expenses should be avoided .the business plan should be followed up judiciously as well .

 

[Efficient5713]

Debt is one thing I have always try to shy from as an individual.
Permit me to tag it a 'wild setback'. Debt can be a setback in a business when you are not able to meet the requirements agreed upon initially and then the necessary action are been carried out. These could have negative effect and setback to your business.
A way to avoid debt in a business is that, try to have or gather enough capital before starting a business.

 

[Peppul]

Yes I agree that majority of businesses will experience startup problems especially when you don't take your time to plan well. And I notice that alot of people will choose to borrow money to startup their businesses having this idea that nothing can go wrong instead of using their own money for the business startup. It's easy to avoid bad debt and the only way to do that is not to take up loan for your business.