{"id":4399,"date":"2016-04-04T10:47:30","date_gmt":"2016-04-04T15:47:30","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-law\/smallbusiness\/business-debt-and-bankruptcy\/small-business-debt-collection.html"},"modified":"2026-03-26T01:15:00","modified_gmt":"2026-03-26T06:15:00","slug":"small-business-debt-collection","status":"publish","type":"page","link":"https:\/\/www.findlaw.com\/smallbusiness\/business-debt-and-bankruptcy\/small-business-debt-collection.html","title":{"rendered":"Legal Ways for Small Businesses to Collect Debts"},"content":{"rendered":"\n
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Legal Ways for Small Businesses to Collect Debts<\/h1>\n\n
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\n By Catherine Hodder, Esq.<\/a> | Legally reviewed by Jordan Walker, J.D.<\/a>\n | Last updated\n
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Editorial Note: We earn a commission from affiliate partner links on FindLaw. Commissions do not affect the editorial integrity of our legal content.<\/p>\n\n <\/div>\n \n

\n \n <\/i>\n Legally Reviewed\n <\/summary>\n\n
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This article has been written and reviewed for legal accuracy, clarity, and style by FindLaw\u2019s team of legal writers and attorneys<\/a> and in accordance with our editorial standards<\/a>.<\/em><\/p>\n\n <\/div>\n <\/details>\n\n

\n \n <\/i>\n Fact-Checked\n <\/summary>\n\n
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The last updated date refers to the last time this article was reviewed by FindLaw or one of our contributing authors<\/a>. We make every effort to keep our articles updated. For information regarding a specific legal issue affecting you, please contact an attorney in your area<\/a>.<\/em><\/p>\n\n <\/div>\n <\/details>\n<\/section>\n\n\n

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Key Takeaways<\/h2>\n

Small business debt collection is the process of debt recovery of unpaid invoices and late payments from customers. Small business owners can send formal demand letters, set up structured repayment plans, utilize debt collectors, and sue for bad debts.<\/p>\n\n <\/div>\n <\/div>\n<\/div>\n\n\n

If you own a small business<\/span>, you know firsthand how difficult debt collection<\/span> can be. Small business<\/span> debt collection<\/span><\/a> is often one of the main failing points of many businesses throughout the country. With a little practice and courage, however, you may be able to lessen the amount of late payments<\/span> that are due to you, and even know how to handle non-payment<\/span> from a customer<\/a>.<\/p>\n

It is critical for the financial health of your company to have a positive cash flow<\/span>. If your company has a lot of unpaid invoices<\/span> or overdue accounts<\/span>, your company is at risk.<\/p>\n

Types of Late Paying Customers and Clients<\/h2>\n

In general, small business<\/span> debt collection<\/span> has to do with collecting money owed from customers and clients who fall into three categories:<\/p>\n