This should be reflected in the tonality, as well as the number of escalation levels, which we will outline here to demonstrate business obligations to partners involved. At the same time, a professional dunning system is also geared towards retaining customers. The aim of the reminder letter as a tool for managing receivables is to reduce the number of outstanding debts, and to avoid the loss of receivables. In addition, judicial disputes can often be avoided by appearing commanding and stressing the importance of payment throughout the dunning procedure. As a rule, the reminder letter is a prerequisite for further legal steps.
Correct procedure is of central importance during a dunning process.
#Past due invoices how to
In this article, we will show you how to demand a settlement for outstanding bills in a professional manner. If out-of-court measures do not lead to the desired result, companies have the possibility of asserting claims for payment through a court order. This is usually done through an out of court dunning process, in which customers or business partners are informed of their default through a series of reminders. Companies therefore endeavor to collect outstanding payments for services rendered in a timely manner. High rates of outstanding debts not only lead to significant interest losses, but if payments end up having to be compensated with loans, additional costs will be incurred. The more unpaid customer accounts you have, the greater the liquidity problem. Outstanding claims – also known as outstanding debts – threaten the solvency of a company.
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