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7 warning signs of customer non-payment

Are you a business owner who is dealing with lot of clients? Does your client seem to be a bit problematic regarding payment? Are you suspecting that you may not receive payment on time?

In business, you should expect late payment. As much as it is not a good thing for business, you shouldn’t forget that it is normal. It is easy to solve late payments amicably with the client and allow business proceedings to move on as planned. However, late payment can sometimes be a sign of a series of excuses that, in turn, lead to the client not paying.

For a business to be successful, it needs to grow and sustain its cash flow. If it reaches a point where you owe several clients money who has shown no indication of paying back, you will have difficulties in your financials. The only challenge is identifying if the client will or will not pay you back. Worry no more; here are warning signs of clients who are not intending to pay accounts receivable.

Check out the below list of warning signs from your client which may show that he has no intention of paying you.

Signs of a client who is not going to pay you back

If you experience some of the signs in this list, you should know that your clients have no intention of paying accounts receivable.

1. Lots and Different Excuses from the Debtor

You should know that people go through different challenges in life, and at some point, your client may miss invoice payment dates or forget to pay on the agreed date. It is normal and understandable. The problem comes when the same excuse keeps on appearing more times.
Some of the most common excuses non-paying customer give include:

  • The client‘s team is too busy to process payment or out of the office at the moment
  • The client is sorry for forgetting to pay
  • They never received invoice from the exporter or it is lost
  • They are going through financial crisis and you have to wait as they deal with first priority matters

Most of the time, the excuses are meant to delay payment time or avoid paying.

2. Bad reputation

Clients deal with many exporters for different goods and services. If you take a background check of your client and notice some fishy activities in previous business transactions with other exporters, you should investigate more.

Clients with a bad reputation with others will probably land on the wrong foot with you when it comes to payment. If other business owners complain more about payment methods or time, then you should proceed with caution.

3. The debtor is in a risky country with very slow bank processes

You may be getting more excuses on how the bank processes in the resident country are very slow. You can learn more about your client just by looking at the credit reports. Credit risk is a common red flag that must be monitored throughout your relationship to ensure you don’t miss any changes.

Therefore, it is important to have a credit report on your client after every order and monitor any sudden changes. This credit risk will help you know whether your client will pay you or not after doing business.

4. Not returning calls and emails after sending reminders

When your client cuts off all communications, it is a sign of them trying to avoid paying you. If your emails and phone calls go unanswered after putting much effort into reaching the client, you need to prepare for other ways of reaching out.
This shows that the customer wants nothing to do with you and your business and hence cannot pay what is owed to you.

5. Change of interlocutor each time

Business change their stuff all the time. However, you should not just sit if your client‘s company starts to shake up its management leadership every time. Sometimes a change of interlocutor may happen in the goodwill of the company, but often, it is a sign of internal problems that can lead to challenges in completing payments.

6. Repeated requests to amend invoices and provide new documents to release payment

If your client occasionally asks for a payment extension, there might be a valid reason for not being able to pay accounts receivable. However, if the habit occurs in a repeating order, you should know something is wrong. Clients can start asking for invoice amendments or some additional documents that were not initially in agreement and ware not a problem in the earlier payment processes. A very big red card for customer non-payment!

7. Requests to deliver new orders and promise to pay all at once

If you notice any change in payment pattern, it is time to be careful with that particular client. For example, suppose your customer used to pay immediately after every export and now is asking for another delivery so as to pay both. In that case, you should be ready for the possibility that the customer will not pay.

We are better able to predict the signs of non-payment from your clients and thus take the necessary measures quickly and efficiently to recover your invoices ,If you have any unpaid trade invoices from Algeria, feel free to contact us at contact@dzacs.com +213555 522 200 since we do amicable and legal debt collection for international exporters.

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