Cash flow, protecting the lifeblood of the business
Cash flow is often described as the lifeblood of a business. This is especially true for small and medium-sized enterprises (SMEs) where maintaining a healthy cash flow is crucial for survival and growth.
Unpaid invoices and bad debts can lead to cash flow issues which drain resources away from core business activities and may affect a business’ ability to meet essential expenses such as tax obligations. For this reason, it is important for small businesses to take a proactive approach in recovering outstanding debts.
Generally, where a business has an unpaid debt, you can explore the following options:
Issue a letter of demand.
Issue a creditor’s statutory demand if you are owed over $4,000 by a company and the amount is undisputed.
Institute legal proceedings. While we understand businesses are often hesitant to institute proceedings, in our experience, depending on the particular circumstances, instituting legal proceedings can be a cost-effective and efficient method to resolving long-outstanding disputes.
Negotiate a solution. This can involve exploring dispute resolution methods such as mediation or arbitration.
Scoglio Law has over 25 years’ experience in the commercial recovery process. If you are a creditor wishing to discuss the possibility of issuing a creditor’s statutory demand, a director of a company that has been served with a demand, or simply want more information about how our processes can work for you, please contact Tony Scoglio or Sarina Fair of Scoglio Law on (07) 3833 2100 or email info@scogliolaw.com.au.