Running a small business is already a juggle, you’ve got customers to look after, bills to pay, and a million other things on your plate. The last thing you need is the hassle of chasing up unpaid invoices. If you’re dealing with slow payers, you’re not alone. Many Kiwi business owners face the same struggle. But don’t stress, there are ways to make small business debt recovery easier. Here are nine practical tips to help you recover outstanding payments without losing sleep (or your sanity).
1. Do Your Homework on New Customers
Not all customers are good payers. Before you start working with someone new, check their credit history. It’s a simple step that can save you major headaches later. Get them to fill out a Credit Application Form, Quotation Form, or Work Authorisation Form. And make sure your forms are legally watertight.
Pro Tip: Use online credit-checking tools to speed things up. Some small business debt recovery agencies (like us!) can even do this for you as part of a bigger debt management plan.
2. Be Smart About Who You Trust
Some clients will always be more dependable than others. If you’re working with a company, consider asking for a Director’s Guarantee, it gives you more security if things go pear-shaped. For brand-new businesses, weigh up the risks carefully. An established company is usually a safer bet than one still finding its feet.
Why it matters: A bit of caution now can save you from chasing debts later.
3. Set Your Terms in Stone (Before You Start Work)
Your Terms of Trade are your safety net. Under NZ’s Fair Trading Act, you need to spell these out before you do any work or supply goods. Having clear terms in place upfront helps avoid awkward disputes down the track.
Pro Tip: Attach your Terms of Trade to your initial forms. It sets expectations and makes you look professional from day one.
4. A Handshake is Nice, but Paperwork is Better
Kiwis love a good handshake deal, but if things turn sour, a verbal agreement won’t help you much. Make sure everything is in writing, whether it’s a contract, invoice, or email confirmation. It protects both you and your client and helps with small business debt collection if needed.
5. Have a Solid System for Debt Recovery
If you don’t have a clear process for handling overdue invoices, now’s the time to put one in place. Here’s what it should include:
- Send invoices as soon as the work is done.
- Follow up with reminders, monthly statements, emails, texts, or phone calls.
- Regularly review accounts to spot late payers early.
- If a debt is still unpaid after 60 days, escalate it to a small business debt recovery agency.
Why it works: A system keeps everything consistent and professional, increasing your chances of getting paid.
6. Don’t Just Stick to Emails – Mix It Up
Some people ignore emails, others screen phone calls. To increase your chances of recovering unpaid debts, use multiple communication methods:
- Emails
- Text messages
- Phone calls
- Physical letters
- Social media (if appropriate)
Pro Tip: Collect multiple contact details (email, phone, addresses) when you first onboard a client. That way, you’ll always have a way to reach them.
7. Put One Person in Charge
If you’ve got a team, assign one person to handle small business debt recovery. It keeps things consistent and stops unpaid invoices from falling through the cracks. Plus, it frees everyone else up to focus on running the business.
Pro Tip: Document your debt collection process so it’s easy for someone else to step in if needed.
8. Know When to Call in the Experts
Once an invoice hits the 60-day mark, the chances of recovering it drop significantly. That’s where a professional small business debt recovery agency comes in. At Sentinel, we’re more than just debt collectors, we’re your partners in keeping your cash flow healthy. From credit checks to legal support, we’ve got your back.
Why work with Sentinel?
✔ We specialise in small business debt recovery.
✔ Our process is simple and stress-free.
✔ There is no cost to using our debt collection services.
✔ We help you focus on what matters, growing your business.
Need a Hand with Small Business Debt Recovery?
Unpaid invoices don’t have to slow your business down. Whether you need advice, credit checks, or full-on debt collection services, we’re here to help you with your small business debt recovery. Get in touch today, and let’s sort it out together!
With over 30 years of experience working with more than 200 businesses across a wide range of industries, I bring a strong mix of business insight, technical expertise, and leadership to drive results. From startups to global enterprises, I have played a key role in overcoming challenges, driving growth, and streamlining processes. I’m passionate about empowering businesses and individuals, building strong relationships, and delivering lasting value. Specialising in debt collection, I help organisations manage their receivables and improve cash flow, ensuring long-term success.
My expertise covers crafting business strategies, optimising processes, mentoring leaders, and providing guidance on IT Service Management and debt recovery solutions.