You wouldn't believe how angry some of the entrepreneurs and business owners we deal with get about customers that won't pay their bills. Well, perhaps you would!
If you've experienced a customer that's given you the run-around on payment you'll know just how infuriating it can be. After all, there's plenty at stake - even highly profitable firms can be put out of business when the cash stops flowing.
Is naming and shaming really a good idea?
Social media has transformed how easy it is to make it public just how annoyed you are with a customer who isn't paying their bills. I have seen a fair bit of discussion online about naming and shaming of late paying clients in recent months, but is it really such a good idea?
Trevor Tierney, a sole trader, obviously thinks so. He was so annoyed by late paying customers that he set up a website (called 60 days.com) where you can name and shame customers. For a small fee you can log in and report a late-paying offender, and have a look to see who else is there on the list.
Going public with your feelings about your customer might make you feel a bit better - and you could even see it as a public service to help make other business owners aware - but I strongly believe that you should keep your grievances to yourself. There are far better ways to work behind the scenes and bring in the payment, and there are good reasons not to wash your dirty linen in public.
Reasons to be cautious
First, there may be a good reason why your customer has not paid you. They may not have received your invoice or there may be some errors on it that they haven't told you about. How embarrassing would it be to go public, only to discover that there was a reasonable explanation after all?
Secondly, you might open yourself up to legal action by dishing the dirt on your customer. Lesley Kemp, a freelancer from Milton Keynes, tweeted about a Qatari client that had not paid her. As reported on BBC news recently, she was hit with a legal claim of £120k for defamation.
Thirdly, you risk harming your own reputation. Would you want to do business with a company that takes to Twitter or Facebook every time it has a disagreement with its customers?
I do not advocate naming and shaming your debtors. I believe it is almost certain to annoy them and lower your chances of collecting an overdue invoice. If you have a problem with an overdue invoice, why not look for professional outside help instead?
Copyright © 2016 Samantha White, ceo at My Credit Controllers, outsourced credit control and business debt collection specialists.