Why Disputes Happen
Disputes can happen for all sorts of reasons and there’s no real way to avoid them altogether – at some point they will happen, even if you try to prevent them. In business, it is slightly easier to predict where this conflict is likely to happen. For example, any business working with suppliers, contractors or purchasers runs the risk of disagreements.
They may happen because one party doesn’t receive the goods that they think they are entitled to, or another feels they were not paid a proper price for their services, or even a simple misunderstanding of each parties’ obligations. Businesses can find themselves disagreeing about the particulars of contracts, over the quality of service or goods received. Whatever the reason, the important thing to understand is that business disputes do happen, and to plan for how you will deal with them when they do.
How Do Disputes Stop Payments?
Simple – because if the client thinks that the job hasn’t been done properly, or that the service/product they received isn’t good enough, then they won’t want to pay. The best-case scenario here is that the client just wants their issue fixed, and once it is they will pay the invoice in full. Worst-case? They don’t want to pay the invoice at all. Either way, withholding payment is a way for the client to retain some power in the relationship until they feel the dispute has been resolved. But the time between the issue coming to your attention and the payment coming in can be days, weeks, months, or even years – any of which can seriously harm your business cash flow. So, the question isn’t how to you prevent disputes, but how do you handle them properly and get the payments flowing again as soon as possible?
Why Negotiation & Mediation Are The Answer
If a dispute isn’t handled properly, then things can get very ugly very quickly. In some cases, the damage done might be reputational as well as financial, which can cause all sorts of problems. The key is to not let it get that far. After all, not everything has to be resolved in court, and most of the time it is preferrable to resolve things privately.
That’s when having a third party to help you negotiate with your clients and mediate discussions can come in handy. At Debtcol, we’re often called in to help businesses resolve disputes amicably, and get all invoices paid and all parties happy. Our intervention normally avoids the parties becoming entrenched in bitterness and prevents the relationship breaking down to the point where negotiation is impossible. We explore what our client’s objectives are in any dispute and identify the most cost-effective way to resolve it in the shortest possible time. This early evaluation is critical, as it usually reveals that the dispute is not as bad as those within it perceive it to be. We then undertake negotiations with a view to bringing a favourable conclusion, rather than running the risk of a court battle. By undertaking this process, businesses who find themselves not being paid due to the dispute are able to achieve a resolution that suits them. Not only do they save money on court fees and time in pursuing the debt it also means they could continue their relationship with the client, leaving everyone with their businesses and reputations intact.
At Debtcol we believe in resolving disputes quickly and amicably, which means staying out of the court system wherever possible. If you have a commercial dispute that is stopping you from being paid and would like our help, please just get in touch to arrange your free consultation.