A collection strategy is an important part of a business plan

On Behalf of | Mar 22, 2023 | Business Litigation |

Businesses must make money to stay profitable.

Credit is one thing that makes it possible for Ohio businesses to make money. Very few enterprises are able to operate by demanding or paying cash up front in full for all goods and services, especially when they are dealing with other businesses.

Furthermore, the custom is for businesses to pay some expenses, like commercial rent for example, in installments or on a monthly basis.

Unfortunately, a business’s customers, including tenants of a commercial landlord, and sometimes do not pay their bills.

Often, the reason is simply that they have run into financial struggles and are not able to do so. Sometimes, it is just a matter of priorities.

A distressed business might opt to pay for utilities, their employee’s wages and government taxes before their other obligations, even rent.

Of course, even if this situation is understandable, a business cannot simply let their bills go unpaid. If they do, they can face profitability issues and even financial distress themselves.

Some preparation and planning can go a long way to making sure that a business gets its bills paid reliably, but preparation is never foolproof.

In order to collect on a bill, litigation and/or other actions may be necessary

A business should have a robust strategy for collecting their business debts.

When a bill goes unpaid, or when one of their customers or affiliates shows some signs of distress, a business should be prepared to respond quickly.

Often, it pays to negotiate in order to get a delinquent bill off of the books and continue an otherwise good business relationship.

However, sometimes, a Toledo-area business will need to initiate litigation in order to protect their rights to get paid.

Even if the bill is not in dispute, it is still important to follow all of the necessary legal steps when pursuing debt collection in court. This is particularly true when another business is the one behind in paying bills.

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