Debt collection agency Daniels Silverman is advising nurseries to review their terms and conditions of admission to protect their businesses from mounting debts as a rise in payment arrears is predicted.
Carole Hughes, managing director, Daniels Silverman, says:“Our nursery clients are predicting tougher financial conditions and a rise in debt this year. It is important that nurseries ensure their terms and conditions enable them to act quickly and appropriately when payments are falling behind.
“Simple changes to terms and conditions and making sure parents are aware that debts will be automatically referred to a debt collection agency can be very persuasive in ensuring that payments are on time. It is far better to take steps to nip late payments in the bud and prevent debt as nurseries simply don’t have the time and resources to pursue debts through the courts, which can be a lengthy, costly and ineffective process.”
Tips for avoiding debt
1. Review your terms of admission to ensure they include:
· your right to one to three months’ notice or payment in lieu,
· your right to refer the matter to a debt collection agency
· your right to recover all debt collection charges
· your right to charge interest for late payments
· your right to process data provided and refer this onto a debt collection agency
2. Ask both parents to sign admission forms so that if they don’t pay, they are jointly and severally liable for the debt.
3. Make sure you obtain full contact details of both parents (mobile and land line numbers, work numbers and addresses and email addresses).
4. Ask for alternative contact addresses such as other relatives/grandparents – these are helpful in an emergency but also help with tracing parents who are incommunicable .
5. Invoice on time and ensure details are accurate.
6. Hand the parents reminders of overdue fees every week.
7. Don’t get too involved personally; pass the matter to a reputable debt collection agency if late payments persist.
8. Only embark on court action where all pre-legal debt collection avenues have been exhausted and your debt collection agency has confirmed the parents are still at their address and have the means to pay (i.e. are property owners or are employed).
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