Own your own stuff

Times must be tough. I’ve heard from several business owners in the past few weeks that they are suddenly receiving past due notices from major companies for accounts that are paid in full. When they try to resolve the issue, they’ve been told things like, “You’ll have to send us copies of all the checks you’ve written to us over the past five years.”

One owner asked that the company provide a reconciliation of the business account. The response was that the only thing they could provide was copies of their invoices.

I’m struck by the similarities of these stories (including one supplier all have in common but some that are different). The invoices are all at least three years old, in no case have duplicate or repeated invoices been sent, and in each case the company is threatening legal action.

So here’s what bothers me about this. If I own a business and I haven’t collected on an outstanding invoice for several years, shouldn’t I have to provide some evidence that the invoice was unpaid? Shouldn’t I try to work these out with my customers before I hire a collection agency to begin harassing them?

If I own a business (and I do), how much of my time can I spend going over accounts payable from five years ago? How much of my accountant’s time am I willing to pay for to reconcile an account that we have no reason to believe is delinquent?

The upshot for me is simple. If I’ve messed up my billings and haven’t collected (or invoiced even) a client for a number of years, I probably would be best served by writing off that debt. Taking the approach I’ve seen recently will surely cost me that customer – and any others who hear about this type of business dealings.

Shouldn’t a company own its own mistakes?

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Sue Pitts - spitts@iwcc.edu

Michael Mitilier - mmitilier@iwcc.edu

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Funded in part through a cooperative agreement with the U.S Small Business Administration (SBA). All opinions, conclusions or recommendations expressed are those of the author(s) and do not necessarily reflect the views of the SBA