According to Experian, payments by companies in the final quarter of 2010 bucked the slowly improving trend for the year by rocketing 16pc to an average of 25.7 days late.

Therefore, please re-visit your credit control policy to ensure your business doesn’t suffer from the effects of delayed payments.

Here are our 10 golden rules of credit control:

1. Take credit control away from the sales team. Any approaches by the customer to delay payment can then be met with a firm answer of “Sorry, that’s not in my power”.

2. Always obtain and follow up bank and trade references for new customers.

3. Set credit limits for existing customers and stick to them.

4. When the client raises a query, deal with it immediately.

5. Set a timetable for statement(s), reminder(s), threat of legal action, legal action – and stick to it.

6. A phone call is worth a thousand letters! Extract commitment to a date by which payment will be made.

7. Always follow through on threats of legal action.

8. Stop doing work if the customer fails to pay or exceeds their credit limit.

9. If a bill is not for a previously agreed amount, speak to the customer when you send it out so they are prepared for it.

10. Don’t be embarrassed to ask for your money!

Businesses often avoid credit control issues, as they appreciate their customers need more time to pay in difficult trading conditions. However, if you don’t insist on timely payment you risk being left at the bottom of the pile – and this can lead to further complications if your customer ceases trading.

Mills Pyatt offer clients various credit control services

We can carry out credit checks on prospective customers, chase payments on your behalf or act as your credit control department. Please get in touch for more information.