How have you been able to avoid bad debt in business?

[Skysaint]

Good one. Many business owners do not have reserves they can fall back too I'd things are not going well in their various business, they just rely on the business itself ,they forget that the business would still need some form of support one way or the other.

Only the desperate ones do fall a victim of this circumstance. You shouldn't rush into a business simply because you've saved up to the required capital or else you will see yourself borrowing money in no time.

 

[Essy]

Bad debt is a debt that is irrecoverable, the business looses money for such goods or services and I don't think it can be completely avoided, only managed because returns may not be processed, customers may default etc

 

[eLdavis]

Only the desperate ones do fall a victim of this circumstance. You shouldn't rush into a business simply because you've saved up to the required capital or else you will see yourself borrowing money in no time.

Indeed, I was once a victim of this before, I was able to gather the required capital needed to startup the investment and I put it in thinking that was all I needed, things did not go as planned and I was stranded for some time.

 

[Sotherefore]

The really great way to avoid bad debt is to avoid taking loans at all cost. Secondly, never give your product at credit to all the customers and only give credit to those who you trust. You can give goods on credit to those customers who have a good credit history.

Normally people should not joke with a business, even with trusted people because I don't really see the need for you to give our product on credit ,he who does not have the money to purchase a particular product should try to save their money to buy it next time.

 

[Tislad]

Indeed a new establishment needs to avoid any form of bad debt so as not to crumble such establishment.

 

[Heatman]

As far as any kind of business is concerned, you will always have debts but having too much above the kind of income that you make from your business or profit you make from your business is something that is very wrong.

 

[Shigobad20201]

Avoiding debt is mostly an important issue we must avoiding avoiding business most especially with a newly found business, getting a loan or going into debt might ruin the new buisness.

 

[Heatman]

It is very important for newly established business to avoid bad debt at all cost
Bad debt can have a detrimental impact on a business, putting its survival at serious risk. Majority of startups will face financial challenges at the early stage in business and that can lead to early closure of once promising business.

what is the best way to reduce bad debt?

Well, I believe that one of best ways for you to avoid debts in your business is to try as much as possible to improve your income earning potential in your business.

 

[Setho]

I make it a business and organisation strategy that I do not borrow out goods unless the person is willing to provide a way that I can automatically recover my money.

 

[Josan]

The best thing to do here is paying all the tools or machine that you use in working in your company as such it will help settle some debt because this debts arises from there.

 

[kayode10]

I think it is good to imbibe a solid savings culture for your business. This will help you to raise a fund over a long period of time of consistent savings.

 

[Good-Person]

Normally people should not joke with a business, even with trusted people because I don't really see the need for you to give our product on credit ,he who does not have the money to purchase a particular product should try to save their money to buy it next time.

Even I have not understand the concept of credit. I only view credit as a facility for people who are not able to pay for product instantly. However, there are many people who would still buy products on credit terms even when they have money. This is not a good thing, according to me.

 

[Sotherefore]

Even I have not understand the concept of credit. I only view credit as a facility for people who are not able to pay for product instantly. However, there are many people who would still buy products on credit terms even when they have money. This is not a good thing, according to me.

There is even the most dangerous because at this stage they are indirectly trying to bring your business down, if they cannot pay when they have money then obviously they are not going to pay for what they have bought from you anytime soon.

 

[Skysaint]

Indeed, I was once a victim of this before, I was able to gather the required capital needed to startup the investment and I put it in thinking that was all I needed, things did not go as planned and I was stranded for some time.

That's one of the ways to gain experience anyway, you need to face some challenges at some point in your business so you could learn from it. I have seen those who were victims to this and I wouldn't venture into such if am to start mine

 

[Good-Person]

There is even the most dangerous because at this stage they are indirectly trying to bring your business down, if they cannot pay when they have money then obviously they are not going to pay for what they have bought from you anytime soon.

Yeah, such kind of buyers are more likely to scam their sellers. I know of some people who took products from a buyer on credit terms and then they never paid them. This is scam and clearly punishable. However, it usually involves low amount of money, so police usually does not do anything in such matters.

 

[Sotherefore]

Yeah, such kind of buyers are more likely to scam their sellers. I know of some people who took products from a buyer on credit terms and then they never paid them. This is scam and clearly punishable. However, it usually involves low amount of money, so police usually does not do anything in such matters.

That is just the thing, there is no how you will involve the police if the products is just $10 or maybe $20. Because involving police you will even spend more than what you were trying to get from the person that owns you.

 

[Abigael]

I think it is good to imbibe a solid savings culture for your business. This will help you to raise a fund over a long period of time of consistent savings.

I totally agree with you. Saving does help a lot in getting out of bad debt. This is because you won't have to take loans. You will just use the savings on any expenses you need.

 

[Michael 202]

The best way to reduce bad debt is to ensure your possible best not to be in debt at all. Once a business starts owning people or financial institutions, there's a probability that that business might gradually slip into bad debt if care is not taken. I know it can be hard for businesses especially startups not to be in debt but all business should have a Debt management team to for stall slipping into bad debt.

This saying is true but once a business is owing debt i think they should pay off immediately but it is truly hard for a business to go into debt truly because of the debt management team

 

[Joseph212]

It is very important for newly established business to avoid bad debt at all cost
Bad debt can have a detrimental impact on a business, putting its survival at serious risk. Majority of startups will face financial challenges at the early stage in business and that can lead to early closure of once promising business.

what is the best way to reduce bad debt?

That's what am facing now debt from here and here I don't even no how I can pay up the debt cos I don't like it at all but life must go on

 

[kayode10]

There are good debt and bad debt. a good that is the one you used to acquire necessary tools and equipment to increase production in your company.