A common dilemma for business owners worldwide is when to stop chasing bad debts in house and hand them over to a debt collection agency.

On the one hand it's tempting to hold on to your debts in order to avoid upsetting customers as well as avoid paying collection fees and commissions. On the other hand the older a debt becomes the less likely you or anyone else are going to collect it.

Hence there comes a point when pursuing a debt in house costs you more than referring to a debt collection agency.

The age-old question then is, "How do I know when to refer a debt to a debt collector?"

Now while it would be nice to give you an exact length of time the reality is this depends on both an individual debtor as well as your business.

As such, the best way to determine this threshold is with a proven dynamic system. Such a system must simultaneously perform two critical tasks.

Firstly, this system must enable you to recover money from your good customers quickly and amicably so that you can accelerate your cashflows without upsetting good customers.

Secondly, and just as importantly, this system must accurately identify crooks early so that you can refer these debts while they're still young. And as debts become more difficult to recover the older they become, by referring early you'll massively increase your chances of full and speedy recovery.

So What Does This System Look Like?

In essence it comprises of a simple yet powerful three step process.

Step 1. Friendly Reminder: Firstly, as soon as an account falls overdue you must send them a strategically crafted Collection Reminder Letter.

Step 2. Courteous Nudge: Should your debtor fail to either settle this account or alternatively commit to a repayment program within 7 days of receiving your reminder letter then you must call them on the phone.

Step 3. Respectful Ultimatum: If they subsequently continue to dodge settlement or alternatively they default a repayment installment then you send them a Final Demand Letter.

If after this second letter the debtor still neglects the account then that's all the evidence you need that you're now dealing with an individual who has neither any morals nor any intention to pay. At this point there's nothing more for you to do other than pass this debt on to a professional debt collection agency immediately!

Now if you're old school and habitually send out a series of of reminder letters, this rapid-fire 3 step system probably seems heretical.

However, the truth is these three communications are all any good customer needs to settle their account. Every one else poses a clear and serious risk to your business.

And if they're a risk to your business chances are they're also a risk to dozens of other businesses. I.e. if they're having trouble paying you then it's a safe bet they've got a swag of other creditors they aren't paying as well.

What's more, if these creditors are like most businesses, they lack any sort of system to quickly identify and subsequently deal with professional debtors. So while those businesses continue to sit on their backsides and drag their heels, you're taking early and persuasive action.

And in a classic case of the squeaky wheel gets the grease, because you're the first one to put the heat on your debtors, you'll be the first one they'll pay.

But more importantly, because you're the first in line to get paid, the chances they'll have the means to settle your debt are infinitely greater than if you were the last in line... when what little funds they may have had have all been spent paying everyone else.

Bottom Line: following this formula at the prescribed times will dramatically boost the number and speed at which you recover your debts. It all comes down to the irrefutable truth of bad debts... the longer you sit on your debts, the more money you'll lose. Conversely, the faster you recover your debts the more money you'll pocket.



Article Source: http://EzineArticles.com/?expert=Angelo_Ioanides

In today's economy and competitive environment successful businesses are reaping the benefits of one of the oldest strategies - partnering. Online marketers have been using this strategy for years to catapult their sales to unbelievable heights and now, Joint Ventures are making a comeback in the bricks and mortar world of business.

A joint venture is when two or more businesses, individuals or projects come together to co-market an opportunity, project or product to each other's client list and new prospects. It allows you to leverage the relationships and goodwill already established by your partner to the benefit of both parties. So in layman terms, a joint venture is when you join forces with another business to make some money!

With joint ventures, you want to identify people who are selling into your target market with a non competitive product or service but who are working deals with the same individuals who make the decisions on your products or services. Develop a proposal that is mutually beneficial for both parties and a marketing strategy and hit the road with your co-branded offer.

Did you ever hear the old saying "you are only as good as the people you know". This holds true for forming successful joint venture partnerships. People want to surround themselves with successful, positive and magnetic people and businesses with a strong brand so it is critical to align with a business with comparable values and goals.

Although this is one of the quickest ways to enhance your market presence and boost your profits, there are many other benefits to forming a partnership with another business in your space.

Benefit # 1: New Client Acquisition Joint ventures are a great way to acquire new leads and new clients at no additional cost. By having new subscribers, you are able to continuing building a relationship with these people and even if they don't buy from you right away, chances are they will eventually. Not a bad way to build a prospecting list without incurring any fees. Some new online marketers may benefit greatly from giving away all profits from their first joint venture just to build their list for future opportunities.

Benefit # 2: Enhanced Credibility You gain instant rockstar status and enhanced credibility. One of the keys to an effective partnership is selecting the right partner. If you joint venture partner is reputable, trustworthy and has already established a great following, their followers will trust you based upon that recommendation. This is why your "list" is sacred. Do not partner with just anyone, make sure you select someone who is worthy of your list and make sure that you are worthy of theirs.

Benefit #3: Increase Breadth of Services Joint ventures are a great way to offer your clients and prospects additional products. By jointly co-branding a product, you and your partner are able to bring new solutions to your current client list increasing your breadth of services you offer. The more solutions you can bring to your customers, the more valuable you are to your customers.

Benefit #4: Improved Conversion Rate You will enhance your conversion rate. One of the goals when you get your list is to convert those prospects into buying customers. With a joint venture partner, you will increase your conversion rate. Your joint venture partner will be endorsing you and your product and by that testimony alone, will convert more of their leads into sales in their own list. Since they already have an established relationship, their subscribers trust their endorsements and you can leverage that trust by offering a high quality product that will benefit the joint venture partner's subscriber list.



Article Source: http://EzineArticles.com/?expert=Kellie_D'Andrea

Currently the economic recession in the US has created a number of financial issues as a result of which the consumers have a tightened grip over their monetary circle which is most likely to become more unstable with the passage of time. This happens to be a reason why people lean towards insolvency in their corporate businesses or companies as shareholders, partners or money generators.

There are three basic kinds of insolvencies including voluntary creditors, voluntary, and compulsory bankruptcy, which have some similar and different aspects. The shareholders and partners agree upon voluntary insolvency unanimously by liquidating the total amount of their corporate assets, which exceeds the entire amount of the money owned by the corporate.

As far as compulsory insolvency is brought in to consideration, it is essential to know all reasons before you declare your company as "insolvent". Actually, several corporate organizations have been declared as insolvent in order to discharge the burden of heavy loan charges on these firms.

If you are going to announce your company as insolvent or bankrupt, you need to take initiatives for the liquidation process. The liquidation process stops the current ongoing business halting full control over the company. In this way, all shareholders or partners are informed about the insolvency of the company and the liquidation process it will undergo.

Sometimes the creditors want to apply for an appeal to wind up the on going businesses of the company, before presenting the petition in the court, this is known as winding up petition application. The court will evaluate the petition to arrive at a decision regarding the declaration of bankruptcy. If the court approves the petition, it will be published that the company has been given a golden chance to pay debt owed. However if the court disapproves it will be announced that the arguments in the petition are invalid.

If the debt is still unpaid after the specified time, the court will award the petition along with the winding up order. In this way the process of liquidation will start. The appointed liquidator will have the authority to evaluate the assets of the company and sell them in order to repay all debts to the creditors of the company. Unfortunately, the creditors are not repaid entirely whenever the liquidator sells the company's assets. When the winding up petition is advertised publicly, the bank accounts of the company will freeze according to the laws of bankruptcy or insolvency.

The liquidator will investigate all directors and managers of the company while evaluating the company's assets. If the liquidator recommends that the directors should be deferred to perform their official duties, then they will be required to abdicate from their positions. If the company's managers try to continue their businesses or trade while declared insolvent, they will be liable to repay all debts incurred by the company from time to time.

Therefore, it is very important to know all necessary information regarding insolvency of a business or a corporation, so that you may not trapped in financial crises due to unreasonable debts.



Article Source: http://EzineArticles.com/?expert=Bobby_Dazzler