Legal Alerts

Common Signs Your B2B Invoice Will Not Get Paid

(May 30, 2019) - Cash flow is the life blood of every business. Companies rely on receiving timely payments from B2B customers to keep a positive cash flow and to smoothly and profitably operate their businesses. Commercial clients and customers who fail to pay for goods and services can negatively impact your company, including the ability to pay your own bills or grow your business.

In managing your company’s outstanding accounts receivable, it is imperative to detect common red flags and take swift action to collect invoices owed to your business. The longer the debt remains unpaid (60 - 90 days or more), the more likely your invoice will not be paid voluntarily.

Depending on the industry, history with the customer/client, and the size and age of the unpaid invoice, businesses should consider seeking a commercial collections consultation, especially when the following warning signs are present.

Your customer or client:

  • breaks a promise to pay. 
  • tells you the check is in the mail or must have been lost in the mail. 
  • tells you they did not receive your invoice. 
  • disputes your invoice only after you attempt to obtain payment. 
  • tells you they can pay you once they get paid from their customer. 
  • avoids your calls. 
  • threatens bankruptcy. 
  • changes their contact information, or it becomes defunct or is fictitious. 
  • asks for more time to pay. 
  • tells you they will pay you once they secure a loan. 
  • tells you they have to pay other bills before your invoice. 
  • bounces a check or sends one unsigned. 
  • claims they already paid you. 
  • flat out lies about the situation. 

If you are dealing with unpaid B2B invoices, we recommend you promptly follow these steps to secure your best chance of obtaining payment:

  1. Analyze all outstanding accounts receivable remaining unpaid for more than 30 days.
  2. Analyze the customer’s payment history. 
  3. Follow up with the customer professionally to find out why your invoice has not been paid, and again request payment.
  4. Determine if any of the red flags mentioned above are present. 
  5. If any red flags are present, seek consultation with a commercial collections attorney.
  6. Always remember that time is of the essence - the longer an invoice is owed, the less chance the debt will be voluntarily paid.

Visit our Complex Business & Commercial Litigation Practice page to find an attorney in your area.

Author:

Bradley A. Singer, Of Counsel

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