Before entering into any business relationship with a company, regardless of its industry, it is imperative to undertake preliminary work aimed at safeguarding your interests. This is all the more important when it comes to establishing relations with a foreign company.
At present, recovering unpaid debts from companies in difficulty is already a complex internal task, and this complexity is amplified in the context of international relations. Here are the recommendations of our international debt collection network.
Preventing Foreign Unpaid Debt Risks in Advance
When considering doing business with a foreign company, it is crucial to conduct a thorough investigation to minimize potential risks. This process primarily involves gathering information about two essential aspects: the foreign company itself and the country in which it operates.
Gathering Information about the Foreign Company:
Regarding the foreign company, the first step is to examine its financial history. This analysis helps in understanding its financial stability, profitability, and payment track record. You can obtain this information by reviewing its annual reports, analyzing its financial statements, and using resources such as credit rating agencies and financial databases.
The solvency of the company is a critical factor. It is essential to determine if it can meet its financial obligations. You can assess this by examining its debt, assets, cash flows, and researching any financial disputes or litigation it may be involved in.
It is also crucial to establish a profile of your debtor, i.e., the company itself. Understand its organizational structure, market reputation, client base, and business practices. References and local contacts can be valuable in this step.
Gathering Information about the Country:
Concerning the country in which the foreign company operates, it is important to comprehend the current economic situation. Analyze economic stability, GDP growth, inflation, exchange rates, and other relevant indicators. Reports from government agencies, central banks, and international institutions are essential sources.
It is equally important to familiarize yourself with the legal regulations and cultural behaviors in the country. Laws and regulations can vary significantly from one country to another, and a lack of knowledge about these standards can lead to legal issues. Moreover, understanding local business practices and cultural values can greatly facilitate business relationships.
Succeeding in Your Collections before the Company's Failure
If a foreign debtor does not seem willing to pay, do not waste too much time. Send regular reminders and quickly get in touch with them to understand the situation.
If you have doubts about their financial situation, we recommend conducting further checks on solvency websites. It is best to be accompanied by a professional based in the debtor's country who is familiar with its specificities.
In the case of the SEKUNDI network, your main point of contact remains the professional in your own country. In the debtor's country, a local professional handles reminders and debt collection. The success-based pricing allows you to initiate procedures without any upfront costs. Back to list