For many organisations, the debt collection process is an unavoidable part of conducting business. Suppliers of goods typically require payment from their customers within 30 day credit terms. However, economic forces, including labour shortages and the rising cost of materials, are leading more companies into insolvency.
When a business cannot recover its accounts receivables internally, it is essential to engage legal professionals who specialise in debt recovery before cash flow issues overcome the business.
This brings us to a question often asked by Credit Managers and those within the trade credit industry more generally: "Should I engage a law firm or another agent to collect the debt?".
Why choose a law firm?
It is not uncommon for a growing business to quickly and unexpectedly transition from being able to effectively handle the debt collection process internally to being outnumbered by debtors who are either slow or unwilling to pay your invoices, leading to significant cash flow issues. Similarly, it is not uncommon for businesses to discover (often once it is too late) that their initial terms of trade were ineffectual and problematic.
Pursuing debt while carrying on business with ineffective or problematic terms of trade means you are attempting to bring money in with one hand but letting money fall out of the other. Ineffective or problematic terms of trade often lead to missed opportunities. For example, Credit Agreements without appropriate charging clauses enable the lodgement of caveats, and Credit Agreements without the appropriate costs clause enable the collection of legal costs and other mercantile fees on a solicitor/client or indemnity basis.
When securing your funds, choosing to engage a law firm like Holman Webb Lawyers means your organisation receives ongoing guidance and support from industry experts with decades of experience assisting clients across various industries with a wide range of simple, complex, and voluminous amounts of commercial recoveries.
It is important to remember that law firms like Holman Webb Lawyers can:
- Be a one-stop shop in debt recovery.
- Provide qualified legal advice on specific disputes that arise early in your debt recovery journey and can provide a strategic pathway for resolution.
- Assist in securing debts by lodgement of caveats and registration of mortgages.
- Negotiate settlements and enter into Deeds of Settlement without the unnecessary involvement of the Court.
- Advise on procedural options and the prospects of success through litigation.
- Effectively review and advise on any Terms and Conditions or Terms of Trade relating to your organisation's supply of goods and services.
Why Holman Webb Lawyers?
Holman Webb Lawyers Commercial Recovery & Insolvency team consists of experienced litigators who can advise and assist clients with all facets and stages of debt recovery and related litigation processes.
Our firm has a proven track record as a trade credit specialist. We understand that strong and decisive action in the early stages of the recovery process is key to maximising any opportunity for a return to your organisation.
Our tailored commercial recovery service ensures our clients receive realistic and effective results based on your organisation's specific needs. We offer fixed fees for each stage of the recovery process without any exorbitant commissions.
As a multidisciplinary firm, we can identify and be resourced to deal with complex debt recovery or insolvency matters.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.