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How Does No-Win, No-Fee Commercial Debt Collection Work?

Here at Access Credit Management, we’re fully aware that effective credit management and cash control are vital for the health of any business, especially smaller companies.  In the UK, there are 5.7 million private sector businesses and more than 99% of these businesses are small to medium enterprises (SMEs/SMBs) which employ between 0 and 249 people.  A huge 5.5 million (96%) of businesses are classed as micro-businesses, employing fewer than 10 people, but these actually account for 33% of employment and 22% of turnover.  These figures clearly demonstrate just how vital small businesses are to use here in the UK – in fact, they are the backbone of our national economy.

Smaller businesses depend heavily on a steady cash flow not for success, but for survival.  Since the year 2000 there has been a 64% increase in the number of businesses in Britain with the number of sole proprietorships (businesses with no employees) has increased by 84% compared with a 59% increase in all businesses. 

The number of new businesses launched (business births) in 2016 was 414,000, up 31,000 from the previous year.  However, the number of business that ceased trading (business deaths) during the same time period was 328,000, meaning that business births outnumbered business deaths.  When it comes to business death, one of the most common causes for small businesses is cash flow problems, often due to late payment either from private customers or, in many cases, from commercial customers, many of which will be larger companies that delay payment as a matter of practice.

Smaller businesses rely heavily on a steady cash flow which means that delayed payments can have a seriously detrimental effect on trading.  A small business that has employees particularly needs a steady cash flow in order to pay employees and any delayed payment can lead to staff having to be made redundant as the business owner struggles to keep going whilst waiting for payment to arrive. 

This is why engaging the services of a commercial debt collection company can be such a sensible option for small business owners.  The debt recovery agent can actually help to secure the cash flow necessary to stay in business and keep employing staff.  Any small business owner who thinks that engaging a debt recovery provider would be risking losing even more money will be pleased to learn that some debt collection agencies operate on a no win, no fee basis.  Hiring a debt collector on a contingency basis in this way means that you can’t lose any more money.  Quite simply, if the debt is not recovered, the agency does not charge a fee. 

A no win, no fee debt recovery provider can be the small business owner’s best friend in many cases.  They will take a look at your business, consider the amounts owed and devise a solution that is individually tailored to the business that is owed money, whether by just one creditor or many.