1 Review the terms of your contract
2 Send a reminder
3 Send a letter of demand
4 Get help with dispute resolution
5 Use a debt collection agency
6 Take legal action
Protect your business from unpaid debt in the future
There are 5 steps you can take to protect your business from prevent unpaid debt in the future.
- Know who you are dealing with - before you enter into an agreement with another business, check who you're dealing with. Check out the advice on dealing with businesses and companies on Australian Securities & Investments Commission (ASIC) website.
- Have a signed contract – putting agreements in writing means everyone can refer to it in the case of a dispute.
- Use a good invoicing system – a good system will help your cash-flow, keep track of customers and help you to keep on top of money you are owed.
- Set up payment terms and policies that will help you get paid on time. Make sure everyone is clear about your payment timeframes and expectations.
- Understand your rights - make sure you're up-to-date on laws such as consumer protection and fair trading. If you aren't sure, talk to a legal professional or business adviser.
