There is no doubt that we are living in challenging and uncertain times. We are all worried about the possible consequences COVID-19 could have on our health and wellbeing as well as our friends and family. Unsurprisingly, the virus has had and will continue to adversely affect our economy too.
As the virus spreads further, the pressure on businesses and the strain on cash flow will be felt across the world. With the current restrictions being imposed by the government, many businesses will be forced to suspend operations or find alternative means of working.
If your customers are in financial difficulty and become unable to meet their financial obligations to you, it will be important to react to those issues quickly.
This is always key. It may be that you can look to restructure any payment arrangement , which would allow you to maintain your own cash flow and your relationship with the customer. Record any agreement in writing, so that all parties are clear on what their obligations are.
If the debt is significant, or if you feel unsure about your customer’s long-term financial position and the likelihood that they will be able to meet their payment obligations, you could look to obtain some additional security.