Phone: 1300 728 444

Frequently Asked Questions

  • What preventative action can I take?

    You can potentially avoid $000’s in bad debts by preparing and implementing Terms & Conditions and/or Credit Application forms NOW. Being proactive will reduce the likelihood of bad debt and also keep your customers aware of the consequences of going outside your trading terms. Good customers will always respect you for this – avoid doing business with those who object.

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  • Is going to court going to cost me much?

    The costs of going to Court range widely depending on the debt amount involved, the jurisdiction, the complexity of the matter, and, at what stage of the legal process the debtor pays (although there can be no guarantee that a debtor will pay as a result of the issuing of legal action.

    Deciding to issue legal proceedings requires a consideration of many factors including your business principles, cash flow, timeframe, the debt amount itself, what evidence you have to support your claim, and, the type of debtor you are dealing with.

    Generally speaking, the Courts do allow for the majority of legal costs incurred by a Creditor/Plaintiff to be recovered from the debtor, although this may depend on whether or not the debtor defends the proceedings. It can be a very different story though in other jurisdictions such as the Victorian Civil and Administrative Tribunal where there tends to be much more uncertainty in regards to the awarding of legal costs - even if you are successful. GSCM staff and/or our solicitor, GSCM Legal, will keep you informed on what amount of legal costs may be recovered.

    As a full debt collection service provider, GSCM will proactively assist you in recommending whether or not to consider proceeding with legal action on a case-by-case basis. Costs estimates are provided by GSCM Legal (and our other associate lawyers), and legal action is not proceeded with without a Client's prior approval.

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  • I don't want to scare off my customer, but I also want them to realise that I need them to pay on time. Is there a way I can achieve this?

    As long as your customers are aware of your Terms & Conditions of trade and you have procedures in place to follow-up overdue accounts in a proactive but friendly manner, then you can actually improve customer relationships.

    Consider implementing incentives for early payment of accounts within your Terms & Conditions (i.e. a discount), and, be proactive in offering your customers the opportunity to repay their overdue account via a payment plan. Be sure to document any accepted payment plan in writing.

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  • What's the difference between using a lawyer and a debt collection agency?

    Put simply, legal firms specialise in providing ‘legal services’ and may therefore provide their debt collection clients with very little more than a letter of demand and litigation services, but charge you for everything on a per-unit-of-time basis, including the issuing of the letter of demand. They may also additionally charge their client's commission on the portion of debt receovered.

    Whilst we also provide our clients with litigation and other legal services through our own in-house legal firm of GSCM Legal Pty Ltd (and external solicitor, Stevens Law, in South Australia), GSCM can additionally provide clients with a whole range of debt prevention, credit management and debt collection services such as a review of your existing accounts receivables process, ledger management, field calls, skip tracing, credit checks and searches, and, the ongoing monitoring of payment arrangements. GSCM do not charge customers for the issuing of letters of demand or the undertaking of pre-legal phone calls. 

    We can also offer clients 24/7 online access to accounts loaded with us for collection.

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  • How old does the debt have to be before I can take action?

    That depends on the terms of any agreement that you may have with your customer(s).

    As a rule of thumb though, if you provide 30 day payment terms, then you should be referring the account through to GSCM for debt collection activity by no later than 90 days.

    We recommend that, prior to referral to us for debt collection activity, you issue your customer(s) with a Final Notice clearly advising them that their matter will be referred through to us if not paid within 7 days. The key though is to make sure that you do promptly act on that threat if they do not pay up.

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  • Is there a minimum amount worth chasing?

    Every outstanding account is worth pursuing for two good reasons. Firstly, debt collection should be a natural extension of your existing internal accounts receivables processes for ALL accounts that you are unable to collect. This shows potential evaders that you are in control of your business. Writing off debts without proceeding to debt collection simply signals to debtors that your business is a soft target, and believe us when we say that 'word gets around.'

    Secondly, it comes down to principle. You have provided the goods &/or services in good faith (and probably incurred out-of-pocket expenses along the way), so you deserve to be paid! Why allow them to increase their wealth at the expense of reducing your own?

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  • I don't have the time to chase debts, so what should I do?

    Firstly, you need to make the time to be aware of what overdue accounts are owed to you, otherwise your cash flow will dry up.

    Secondly, speak to us to implement the necessary preventative action that will save you time (and possibly money)chasing debts further down the track.

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  • I run a small business so cash flow is very important to me. How can I best protect my business from bad debtors?

    As the old saying goes, prevention is always better than the cure. Firstly consider implementing a rigid debtor management system by ensuring each new client transaction is subject to Terms of Trade. Terms of Trade will help clients understand what is required of them, and can provide creditors with suggestive means of achieving prompt payment in addition to the usual terms of payment. For example, Terms of Trade could allow a creditor to cease the supply of goods to a debtor where an invoice has not been paid for 30 days..

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