Carpon
Valued Contributor
Bad debts are debts that cannot be retrieved and bad debtors are people that lead to bad debts.
Bad debt is very deragatory and can detoriate a business and affect it's stability.
So how can one be able to manage bad debts in business?
✓ Take note of Potential bad debtors: Get to know all your bad debtors and the cause of their lack of debt settlement. Make a list of such people.
✓ Avoid giving goods on credit to such people: After you have noted such people down, you must try and avoid giving them goods on credit. It may be hard at times especially if a good relationship exists between you, but you need to do this if you need your business to stand.
✓ Be careful while giving out goods on credit: Do not give out goods on credit to anyone without a crucial reason and confirmation of getting your money paid duly.
✓ Source for funds and put in place of the amount lost to bad debt if possible.
Bad debt is very deragatory and can detoriate a business and affect it's stability.
So how can one be able to manage bad debts in business?
✓ Take note of Potential bad debtors: Get to know all your bad debtors and the cause of their lack of debt settlement. Make a list of such people.
✓ Avoid giving goods on credit to such people: After you have noted such people down, you must try and avoid giving them goods on credit. It may be hard at times especially if a good relationship exists between you, but you need to do this if you need your business to stand.
✓ Be careful while giving out goods on credit: Do not give out goods on credit to anyone without a crucial reason and confirmation of getting your money paid duly.
✓ Source for funds and put in place of the amount lost to bad debt if possible.