Delays stink. If you are stuck in traffic, or if your flight is delayed, it can wreak havoc with your schedule. A delayed flight could lead to a missed meeting which could result in a blown business opportunity. Small business owners who delay getting outside help collecting from delinquent customers are inviting some unfortunate consequences.

While small businesses should attempt to recover bad debt on their own, in-house efforts should be limited in time, and if they are unsuccessful, help from a third party is needed, usually a collection agency or an attorney. Businesses should set their own limits on how they want to wait as each business is different, but they must stick with their self imposed deadlines.

Too much delay is like gambling with your accounts receivables. Here are some issues that can develop:

1.  The delinquent customer could move out of state. This would not make it impossible to collect but it will likely make it more difficult.

2. The delinquent customer could sell an asset that you might have been able to attach for payment later on.

3. A business customer could go out of business.

4. Your customer could incur more debt, be less able to pay you, or even declare bankruptcy.

5. Other more proactive creditor could take legal action and place liens on their property, wages, etc. You would then be behind those.

6. You could incur a higher contingency collection fee. Higher fees for older accounts (over a year, or in some cases, over 180 days) are common, because older debts are more difficult to collect.

Generally, if a customer has ignored you, or defaulted on promises to pay you for more than 90 days, you have a problem, and you need to get help. If you want to wait a but longer do so, but know the risks involved.

How long do you wait before sending a file to your collection agency?