What is credit? Credit, simply put, is making a purchase today with the promise to pay for it tomorrow. Typically, this involves establishing a relationship between a business and consumer based on financial trustworthiness and measure of risk. Typically, this depends on the 5 C’s of credit: character, capacity, capital, collateral, and conditions.
These days, there are more options than ever for accepting payment. It’s easy, however, for a new business owner to get caught up in the excitement of making sales while simultaneously forgetting the necessity of having a well-thought-out approach. For example, which payments will you accept? How will you handle payment plans? What collection methods should you use to ensure debts are paid? These considerations are essential to any small business’ success.
Using your credit wisely is the best way to avoid debt. There are certain habits, however, that can derail your efforts. Here are a list of bad habits that you should avoid in order to avoid falling into unmanageable debt.
Let’s dive into why it’s important to pay off old debts, set a plan for getting out of debt, and ultimately shifting your life to a position of avoiding bad debts where possible.
Find out when to use a collection agency, how to choose the right agency, what it’s like to work with a collection agency, and how working with a collection agency impacts your business.
