Cannabis Credit Consulting
Cannabis collections has become a pertinent issue. Many businesses have begun extending credit terms to cannabis which aid in increasing sales and presence within the industry. More often then one would think, the success of these borrowing business are merely a façade, and their lenders none the wiser.
Depending on the status and standing of the claim, it is often the best choice for an operator to contract a contingent collection agency to make contact and reach settlement with the debtor, before considering further litigation. Never forget, lawsuits are time consuming, stressful, and most importantly, expensive. Often times, it takes many hours of diligent work to resolve issues with non-responsive debtors. With the risk of high labor and opportunity costs, it is nearly always a lender's best opportunity to collect outstanding debt by using a specialized collection agency and outsourcing the collection work to the agency.
Proper Credit Applications and Invoicing
Without proper credit applications and invoicing procedures, companies who release terms to cannabis companies have begun to see their A/R column grow. Usually the debtor “forgot” to pay, is going out of business, or is simply avoiding payment. It is these types of outstanding claims that cause receivable managers migraines and a business's cash flow hurdles for those issuing terms to the cannabis industry.
These risks are easily mitigated. Ensuring proper credit checks, valid and enforceable credit agreements, efficient invoicing, and implementing standard A/R procedures are strategies that remain critical in preventing future collection challenges.
As a veteran in commercial collections, Ross Gelfand Esq. has the experience, resources, and tools needed to structure a tight, effective credit program for businesses of all sizes. Contact CannaBIZ Collects to schedule a one-on-one meeting with Mr. Gelfand to properly establish credit management best practices for your growing business.