Whether a client has been faithful, always paying its debts on time, or goes out of business without warning, the process of collecting a debt owed to you by any firm may one day be placed on your shoulders. It's a perplexing process, and if the debt is substantial, it may cause you to postpone doing business with other firms or close your doors or good.

Years ago, before my business opened, I started a relationship with a company called Home Hunters. The firm supposedly specialized in helping apartment seekers find living quarters. The contract I signed with them stated that if they did not find an apartment for me within six months, I would receive a complete refund.

Six months passed, and I called the firm to begin proceedings to collect my investment, but the company suddenly went out of business. I was young and had no idea what to do, but I knew that I would not give up on receiving a refund.

I called the Better Business Bureau to explain the situation and find out if they could be of assistance. The company may have gone out of business, but I had a feeling that there was some recourse.

The BBB did some research and learned that a class action lawsuit against the company was pending. By filing my grievance with the county court, my name and amount due would be part of the suit.

I followed procedures, and within a year I received a check for a fraction of what I had paid. It was a small amount, but I felt vindicated for pursuing the case.

Business situations are more complex, especially when it's your business that must move forward against a firm that ignores your requests to pay monies due.

One of my clients purchased videotapes on a regular basis. Soon, invoices that weren't paid for several months were ignored for several more. I instituted a letter writing campaign, which started a trail to document my attempts to collect monies owed. Three letters are usually sufficient to convince a court of law or debt collection agency that more pressure is required to settle the debt. Finally, I received a check from the firm.

The energy used in this process should have been dedicated to other parts of my business. It was a time drain I didn't want to occur in the future. Once the debt was paid, I contacted the firm by mail stating that all new purchase orders must be paid in advance by check or credit card. You always have the right to change the payment terms, and it should be done before another order is fulfilled.

If the client owes you a few hundred dollars, you can institute this policy, but when a firm owes millions at a time, a more personal relationship with the main contact and accounts payable must be initiated. Calling each person every week usually expedites payment. That's one way to bring the situation to a satisfactory end.

Then there's the problem of nonpayment, no matter how many letters you've sent or nonpayment because the account has ceased operations. That's when a professional debt collection firm is required. It's an expense you didn't count on, but it's also another cost you must absorb in order to collect what’s due.

Debt collection firms are found throughout the word, and their track records are remarkably high because their fee hinges on their ability to retrieve your money. Do some research to find companies in your area. Call a minimum of six firms to learn their rates, methods, and terms.

Like most businesses, the firm with the lowest cost is not always the one to hire, so don't make a determination by fee
alone. Speak with members of your association or chamber of commerce to find out who's experienced this same problem and how it was resolved. Speaking with someone who's been through the channels elevates your comfort zone, allowing you to move forward to get all or part of the monies owed to you.

There is no easy answer to the debt collection process. It's simply another task to add to a list of goals that are hopefully performed occasionally rather than daily.