What happens to a company with a bad credit score?

Image source: fairviewfinancial.co.uk

Most people are aware of what happens to a person with a bad credit score. Financial institutions could see someone with bad credit score as a liability. If you have a bad credit score, it will be unlikely for banks or other creditors to offer you a line of credit. Besides this, it can also affect your purchasing power. You may find it difficult to make large purchases like automobiles or properties if your credit score is terrible.


According to the finance experts at Brennan & Clark, a trusted debt collection agency, companies can also have a bad credit score. What does happen when a company has a bad credit score? Is it the same as that of an individual?

The answer is it can be worse for companies with bad credit rating. And like personal credit, a business can get a bad rating when it starts failing to make payments regularly. Perhaps the company has other payment obligations as well, and it chooses to use its line of credit to pay off other debts only to have its debts consolidated in its business line of credit.

Image source: oneboxfunding.com

A business with a bad credit score is viewed differently by other firms. For example, utility companies would ask clients with bad credit ratings for a deposit before rendering any services. As for other services such as distributors, they may just outright deny the business of goods if they feel like the business won’t be able to make payments. Finance experts at Brennan & Clark believe that bad credit ratings are there to protect the users themselves from getting into debt so deep that they are unable to pay them off.

Brennan & Clark is a business collections firm that offers receivables support solutions to businesses. Through this complete program that is customized to meet the needs of every client, the firm provides assistance in evaluating and improving on a company’s collections process. Follow this Twitter account for more similar updates.

What business owners need to know about microlending

As part of upholding its stellar service to people everywhere, Brennan & Clark has shared a number of highly-informative blogs and articles on debt, credit, collections, and everything in between. On this blog, the firm focuses on microlending and what people need to know about it.

Image source: themindfulword.org

Also known as microcredit or microfunding, microlending’s popularity skyrocketed in the ‘80s. With the subsequent boom of microenterprises in the decade (mostly run by people who didn’t have funding and needed to start over), the public’s opinion of microlending seemed to sway more towards the positive side. However, it has been questioned throughout the years.

An issue was raised on how most people who were lent money through microlending never really used or intended to use the funding for a business. Microlending affords these individuals with a brief reprieve from poverty, but also increases their expenses and deepens their debt through interest. As one critic puts it – microlending really doesn’t do poor people any favors since it inadvertently teaches them to spend more rather than save money. Ultimately, people in the lower income class don’t go above the poverty line.

Image source: wsj.net

But not everyone who resorted to microlending sank deeper into debt. For some people, microlending funds were used to start small businesses (which is the ideal route, Brennan & Clark notes), thus breaking their own vicious cycle that many people fell into.

Brennan and Clark is a business collection agency that has been operating since 1980. A member of the Commercial Collection Agencies of America, the firm offers unparalleled service as well as the most comprehensive guarantee in the industry. For more information on the company, visit this website.

How to collect debt effectively through email

When done correctly, debt collection by email can be a resounding success. Some of the basic mistakes that companies make when trying to collect unpaid debt from their clients are being rude, unprofessional, and even resorting to illegal means. Avoid these missteps and collect debt effectively through this medium—here are tips from trusted collection agency Brennan & Clark.

Image source: Pixabay.com  

Email can be a great way to collect unpaid debt, despite phone conversations remaining the preferred way of discussing this business concern. This is especially true if you need to follow a paper trail, document the conversation, or make quick follow-ups.

First and foremost, you have to showcase good communication; consider outsourcing this service if you have no time or satisfactory experience in communicating this important financial aspect. You may also consider using collection email templates and online examples for proper guidance in creating past due emails and collections emails. Use well-crafted templates to collect client payments faster—and stay credible and come across as an expert while doing it.

Image source: Pixabay.com  

Be short and straight to the point in your subject line, letting the recipient know what it’s factually about. This will greatly increase the open rate of the email. Stay polite and professional in your tone, too, by keeping the content short and clear about the action needed on the recipient’s part. According to Brennan & Clark, part of this is sending the email only to the concerned individuals (not their managers or direct reports if it’s unnecessary) as well as responding in a timely manner.

Brennan & Clark is a business collections firm that has been in the business for over 30 years. The firm’s management team has been together for the past 20 years, and the combined experience and expertise of its staff enables the company to guarantee average recovery rates higher than the industry average. Read more on this page.

Ways to expedite debt recovery for your business

Image source: aa-accountants.co.uk

It’s increasingly becoming more difficult for companies to collect their receivables, even with pledges of loan collaterals from borrowers. Businesses must, therefore, be conscious of establishing more-defined methods to collect faster. Below are some tips to speed up your collection procedures.


You can begin by establishing a reward system that benefits those who pay early and penalizes those who are always late. There is a clear collection cycle that borrowers sign for and must abide by, so hold them to it. But customers will be more encouraged to pay up faster if, say, you can offer percentages off bills, discounts, or other value-added services to those who do so. You can also waive late charges if borrowers quickly pay outstanding balances.


The billing process should be better streamlined if you are to recover debt much sooner. The premise is that you can’t collect what you haven’t billed. Send those invoices promptly and track billables regularly. Monitoring will be largely helped by having a team dedicated to doing courtesy collection calls, especially for delinquent customers. It could also be that there are mistakes made in inputting the customer address, or that the borrower has changed their email address. That little call goes a long way in expediting the payment process.

Image source: financebusinesstrading.com

As a lender, you’ve to exercise due diligence on both new and existing customers by closely studying their credit rating, payment history, and references. This way, you eliminate risks. Lastly, it’s best to get in touch with a professional collection agency. You don’t have to just do it all on your own or be forced to go to court; a third-party collector will have a devoted team doing the job for you, allowing you to focus more on running and improving your business.


Business collections agency Brennan & Clark aids entrepreneurs in eliminating credit losses. The firm has been around for more than 30 years and is known for forming strategic alliances with its clients to formulate effective collection strategies. More on the firm and its services here.

Becoming An Efficient And Effective Collection Agent: Some Helpful Tips

Many beginning collection agents carry the mindset that the job requires a confrontational attitude. But this is not the case: getting the job done best begins with a willingness to listen and to empathize with people.

Debt collection can become messy if the collector comes into the picture unwilling to negotiate. The idea is to work together with the debtor, and this starts with listening. Whether on the phone or at a set meeting, the customer should be allowed to talk and explain. This type of communication progresses into trust, and allows the debtor to be more at ease with the collector.

Image source: firecredit.eu

Don’t rush. Start your turn in the conversation by offering your name and the company you represent, even if you know it’s the umpteenth call for the day. Take your time in explaining the situation to the debtor. The tone of your voice will direct the flow of the conversation. Lay down the argument and the legal aspects clearly, including bankruptcy procedures and how non-payment affects credit rating.

 

Also, be concise but transparent; avoid repeating the same points but make sure that the credit situation is clear, including the repercussions of not addressing it. Proceed by presenting the best routes and recourses to deal with the problem.

Image source: webstarts.com

Lastly, no matter what happens, relax and keep your cool. Even if the debtor gets agitated and starts shouting at you. It’s not worth ruining the rest of your day. Keep in mind that it’s not about you.

Brennan & Clark LLC is a business collections agency that provides customized receivables support solutions that help businesses eliminate credit losses. It has been operating since 1980. For more on the firm’s service offerings, drop by this page.

What Businesses Should Know About Credit Extensions

A lot of companies extend credit to their customers with the idea that this will help them gain more business. While extending credit may seem like a good decision for some companies, it is not always the case.

Businesses like retail stores, healthcare providers, and transportation services require straight cash transactions for their rendered services. But other business types pursue extended credit. Offering credit can get customers to spend more which can turn into increased sales. It can also establish healthy company-customer relationships.

Image source: theatlantic.com

Many businesses offer credit in hopes that they can sell better than their competitors. But offering credit can bring more losses than gains for some companies, especially with startups and local businesses. Credit can cost the company money. When a seller offers credit, the customer is using the product they have on loan, but the company gets nothing from it until they are paid.

Image source: nerdwallet.com

When companies offer credit, they assume that the customer has the intention and ability to pay. They look at customers as blank, clean slates who can pay on time. But often, customers take full advantage of the credit, causing the company to lose money. Being aware of a customer’s credit rating and history can be a great way to know about their intentions of paying. Offering credit is not always bad, but it could cause damage if it is given to the wrong customer.

Brennan & Clark is a collection agency that helps businesses get profit through customized receivables support solutions. More about the company’s services here.

Small Business Money Matters: Understanding and Optimizing Cash Flow

Cash flow plays a vital role in the survival of any business through all the stages of its life cycle. Nowhere is this more important during the buildup phase, where business owners must pay off debt obligations, pay employees, and stretch out the initial funds until the enterprise can get on its feet. Companies that fail to manage cash flow adequately within the first year of operations almost certainly fail to survive the following year.

As the business expands, the revenue accumulated would pay not only for the operational expenses but also serve as a gauge to determine potentials for growth. Frequent interruptions in cash flow can stymie development and may in extreme cases cause a business to grind to a halt.

Image source: entrepreneur.com

Cash flow management begins with finding the break-even floor, the point where revenues match expenses. Efforts must be made to break even, which may seem initially counterintuitive for those oriented toward profit, but would actually free business owners to pursue profit once all expenses have been covered. Payment capacity, in turn, should be based on actual revenues on hand rather than short-term profit projections.

Ensuring cash flow may also entail actively reducing and managing expenses. While some expenses can be eliminated from the onset (something lean startup advocates prioritize), others must be selected over others. Paying for everything all at once is a recipe for long-term disaster; whenever possible, businesses should get longer payment terms on loans and credit to reduce their initial monthly cost.

Image source: arborinvestmentplanner.com

Finally, business owners should make efforts to boost the amount of payments coming in. For sales-based businesses, this involves creative incentives to motivate employees to close more deals. Commission-based business-to-business enterprises should have in place a system to deal with the occasional late payments. Finally, businesses that offer in-store credit should have stricter requirements for any credit applicants.

Having behind it more than 30 years of experience in the revenue collections industry, Brennan and Clark works closely with clients to create programs that enhance their existing collections strategies. Visit this Facebook page for more on the company and its services.

Assessing problems in business collections

Image Source: toplawyercoach.com

Collecting payments from clients isn’t always an easy task. There are times when the process is easy to manage, and there are times when delinquencies just start to pile up. During lean periods when the cash flow slows down, failure to collect money owed can lead to bigger problems in the future. Before issues pile up, it is best to assess the situation swiftly and to provide solutions as soon as possible. 


To start off, businesses should check their collection process. Delays in invoicing are all too common cause of delays in collecting receivables. Business owners need to ensure regularly that their internal systems are totally current at all times. With a little diligence in this task alone, it is possible to vastly improve an organization’s cash flow. 


Image Source: hawaiiesquire.wordpress.com

Second, business should also take time to review their communication methods. These days, diversifying and using more than one channel to send invoices has become an effective method to ensure that clients get the reminder they need to pay on time. 


Finally, managing expectations is necessary. Being upfront with expectations of prompt payment is vital to ensuring that the client pays on time. Slow payers, when compared to delinquents, are often those who remain unconvinced that obligations have to be paid promptly. Some companies also make the mistake of waiting too long before they insist on collecting payments. It sends a signal to clients that delayed payments are acceptable. 


Image Source: bubblews.com

Other than problems within the business, it may also be a good idea to get in touch with clients to find out their reasons for delayed payments. Some clients may just have short-term problems that the business can help address, ensuring not just prompt payments but also a better customer relationship. 


Brennan and Clark is a leading commercial collections agency that goes beyond the usual process to provide receivables support solutions that eliminate credit losses. For more resources on improving the collections process, like this Facebook page.

Minimizing time wastage in the collection process

Image Source: fundinggates.com

Collecting payments from clients can be a time-consuming process. Most clients can be expected to settle their balance in the normal course of business. They will, however, be affected by various factors. Keeping track of payment arrangements with each client will prove to be difficult unless businesses develop an effective strategy.

In general, there are a number of established methods for collecting debts owed to the business. The methods that companies use depend on a number of factors such as their relationship with the client, the reasons for non-payment, and their own financial situation.

Image Source: smashingreader.com

Relying on notices of late payments alone leads to a lot of time wasted. Letters are the least effective collection technique because people know the strategy behind it. If a client receives a gentle reminder then it is obvious to them that they have more time before they actually need to pay.

Collections can be done better in person or through the phone. Not only does this type of approach reduce the lag in communications, it also allows the business owner to immediately respond to any issues raised and get a firm commitment from the client on the date of payment.

Image Source: healthdatamanagement.com

An aggressive approach to collections may be more effective at allowing businesses to reach desired goals. However, it comes at the risk of ruining a good relationship with a client. For that reason, threatening legal action for collecting debt may not make sense for important clients and close associates.

When dealing with large companies, businesses may need to adjust their collection methods and timing to jive with the schedule of the client. This may involve finding out the schedule for getting an invoice approved, the documents they need, and if they require a regular follow-up call.

Brennan and Clark is a commercial collections agency with a management team that has been together for the past 20 years. For more information on its services, visit this website.