Small Debt to collect - advice please?

inmypocketnottheirs

YEOVILGOM wrote: »

OK - I speak as a credit controller who also does a little bit of debt collection.

My advise to you - forget about it and move on!

The biggest errors businesses make when chasing money is taking it too personally, not knowing when to give up and leaving it too late to appoint the experts.

Easy when it isn't your money.

Vomityspice

YEOVILGOM wrote: »

OK - I speak as a credit controller who also does a little bit of debt collection.

My advise to you - forget about it and move on!

The biggest errors businesses make when chasing money is taking it too personally, not knowing when to give up and leaving it too late to appoint the experts.

Any decent debt collector is going to want at least 15% of recovered money - in this case £22.50. Would you do it for that?

Sorry, but I second that sentiment.

Far too many people get overly emotionally involved in 'winning', and forget about the actual cost to them (both financial and in time/effort/aggravation). Whilst I often hear 'it's the principle', the reality is that often your flogging a dead horse. A real winner knows when it's time to give up and move on.

Whilst no one wants to lose £150, is £150 REALLY worth all the aggravation? Try and work out how much time any effort it will cost YOU to recover this money (if at all)? If your paying yourself £10 an hour, can it all be done in 15 hours? If your paying yourself more, they cost/time ratio won't be favourable.

You are probably better of just writing if off as a bad debt (you'll claim it back anyway as a tax deductible!).

pastmybest

I absolutely agree with yeovilgom and vomityspice.

I am sorry whilst I know £150 is £150 you are better spending your energy and time on getting on with your business and write this relatively small amount off. I went through the same as you in my earlier years of S/E but a wise business friend showed me the negativity it causes it not worth it.

But yes I did chase the bigger debts.

moneypooh

It's all well and good saying just drop it as bad debt, but what happens if they are doing this to everyone? What if their attitude is the same, they know you're not likely to do anything about it? This could mean they run their business on the back of these kind of transactions. If someone stole £100 from your wallet you wouldn't feel the same way. If they have taken goods & services without paying it's still theft, and these kind of companies really do need a wake up call.


"I am sorry whilst I know £150 is £150 you are better spending your energy and time on getting on with your business and write this relatively small amount off. I went through the same as you in my earlier years of S/E but a wise business friend showed me the negativity it causes it not worth it.

But yes I did chase the bigger debts"

But that's all relative isn't it? If you earn £250 a week then that's a high proportion, however you say chase bigger debts, a what percentage of your turnover do you start? It's not quite black and white.
I also don't see that it's negative, you fill the forms out online and it's very easy. I'd be more negative about someone getting away with ripping me off.

Vomityspice

If the OP does make a claim he will need to stump up £25 (if online) or £30 if done at his local county court. Note that this is 16% of the sum outstanding.

In addition to this, the OP will need to spend HIS time in completing the N1 form (that will never be refunded).

In the best case scenario, they will win and then have to pay another set of fees to enforce the order i.e.

Information meeting (£50 -i.e 33% of original sum)
Bailiff-warrant of execution (£100 - i.e. 66% of original sum)
Charging Order (£100 - i.e. 66% of original sum)
3rd party Order (£100 - i.e. 66% of original sum)

So the maths (ignoring any cost for your own time), means that action doesn't look favourable. Indeed, as the supplier has already bounced a cheque (usually indication they have no money), you have to question the logic of spending any more money with no realistic chance of getting it back. Unless you 'know' they have money or assets (if so why did the cheque bounce?) if would be foolish to spend money you are never going to get back.

paulofessex

The costs as you have indicated may be the case, however l personally would at least start the process i.e. submitt the claim as you may find that receiving court documents via the post may make the company think twice and pay up. The OP will be able to choose to whether or not to presue the issue at each stage.

Also the OP needs to keep in mind the claim is against the 'company' and the claim should be as such as this would have more of an impact on the companys crediabitly in the future.

hippyadam

YEOVILGOM wrote: »

Any decent debt collector is going to want at least 15% of recovered money - in this case £22.50. Would you do it for that?

Yup, if i've done the work i want the money frankly. £127.50 in the bank is far far far better than nothing!

This is why i use an agent, it gets to 30 days and bang its with them. I then forget about it until i receive the money in the bank :P

Writing off any amount should only ever be done, after you've had a good go at collecting it! (or someone else has on your behalf) This is money saving after all and not money losing :beer:

Oh and it should be noted that a bounced cheque is actually a good thing in this case. As if it does go to small claims they've basically already promised payment once and not upheld it. Bad for the debtor, good for the creditor.

proe

What service did you supply to your customer? Is it not something you can retain title on and remove? If so then you could just turn up and take it away, stating that you retain the rights to the goods until they are paid for in full?

inmypocketnottheirs

Principles are only principles when they cost money. Therefore, on principle I would take legal action on the basis that the costs in pursuing the debt are all tax deductable, and the £150 is too. If I am going to lose £150 off my bottom line, then I may as well lose the costs and have the satisfaction of knowing that the debtor has a CCJ registered against them making it difficult for them to get credit.

It's all too easy to roll over and play dead.

property.advert

I see this from both sides having been in business myself.

On the one hand, spending £300 to chase down £150 and spending 50 hours on it is stupid. However, spending £2 on a land registry search to see if he owns his property and 15 minutes of your time may be worthwhile.

I agree that people become too attached to debts but I also know that principles are important to people.

One senior lawyer, a partner in his own name practise represented a client in a case against me. The lawyer telephoned me and said that if he had to financially assist his client to make good on an incorrect bank transfer amount to settle our case then he would. He backed out of that commitment.

I considered taking him to the small claims court but I sent him a letter and went standing outside his office with printed paper matter stating how he had gone back on his work and could not be trusted. He very quickly settled the matter.#

Is there any option for direct action ?

The issue for me would be the bounced cheque. Are you sure it was bounced and not cancelled ? If bounced then that means he had no money and you may be on a hiding to nothing. If cancelled, then it may be a different story.

I am a vindictive !!!!!! though and I might just screw his life up as much as possible out of revenge. I would however be prepared to face him down for the money as he cannot hide in his house forever.