By Ramir Rodriguez
Good working relationships with your clients should be the overall goal for your small business. Why? It is this long-term relationship with each client that has the potential to be a long-term revenue source for your small business. But what about those clients that seem to give you frequent stress in terms of slow or non-payments? These types of clients are not only a headache to work with but can also be costly to your company. So how do you avoid working with problematic clients?
Investing in this mission however can take considerable energy, patience, time and, sometimes, dollars. Therefore, it is important that you have several resources to help you screen out potentially negative clients such as non-paying and troubled clients. Here are some suggestions on how to perform basic, inexpensive (and sometimes free) business client screenings.
The most commonly used tool to screen a potential client is the internet. With desktops, laptops, smartphones, and tablets, utilizing the Internet as a screening tool is easy and accessible as ever. By doing a simple web search you can access any reviews, news, and information about your potential business client.
Don’t have time to do web searches? Google Alerts monitors the internet for you. Enter names of companies or key phrases to alert you immediately on up-to-date information via email. Receiving news early can mean the difference between making the right business decision or a costly mistake.
Another way to reduce your risk of working with problematic business clients is to ask your peers. Online discussion forums within your industry can provide valuable and useful information about other businesses. It is human nature for people to complain – it’s a way to release frustration. Learning about your peers’ complaints in online discussion forums can be your gain!
If you cannot find any online discussion groups, create your own. Social media sites dedicated to business professionals such as LinkedIn allow you to create and start discussion groups. Inviting your peers (essentially your competition) to your discussion group not only provides a helpful resource where information can be shared, but is also a sign of good will and protecting the best interest of your industry.
Online Paid Services
Depending on the potential volume with a new business client, you can invest in online paid services from corporate credit and information bureaus. Business credit reporting companies such as Dun & Bradstreet and Cortera as well as the three major credit bureaus (Experian,Equifax, and TransUnion) offer valuable information to help you understand payment histories and financial standings of many businesses. Considering that you may lose hundreds or even thousands of dollars, it may be wise to invest in online paid services to provide you helpful information so you can make the right decision.
Other Services Available to You
There are many services available to small businesses that can help screen problematic clients – new or current. Factoring companies (called factors) can do just that. Factors can provide free credit checks to help small businesses understand the potential risk of a new client. You have to be a client of the factor however in order to take advantage of this helpful service, but the best part is they do all the work! Working with a factor to protect you from troubled potential clients can help you save not only money… but valuable time as well.
This article was originally published on Funding Gates. Funding Gates is the world’s first CRM platform for receivables management. Serving as an online credit department for small businesses, Funding Gates is set on making managing receivables the easiest part of running a business.
About the Author: Ramir Rodriguez is a Business Development Officer with Treasure Valley Factors. He has helped businesses understand how factoring can help them get paid on completed work and grow their business. For more information on factoring please visit the blog Factoring Helps. Don’t forget also to connect with Ramir on Twitter and LinkedIn and “Like” Treasure Valley Factors on Facebook!