5 Tips to Determine if a Business is Operating
September 21, 2020
Unfortunately, COVID-19 has left many businesses in the lurch, causing many business owners no other option but to close. What is a creditor to do when a business still owes a debt, but you’re not sure if the business is still viable? Here are a few tips to consider before you continue to chase after a debtor business;
1. Does the debtor’s phone number work?
If the debtor’s phone number is working and is being answered by a live person in the name of the business, the debtor is still operating.
2. Is the mail being returned?
If you’ve tried reaching the debtor by sending collection letters and other correspondence, but it’s being returned to you, chances are the business has closed or moved. We often issue a Post Office Freedom Of Information Act Request to determine if a business or individual has moved or has a forwarding address.
3. Does the debtor have an active website?
If the debtor maintains and active website or has recent posts on social media, that is a great indicator that the business is currently operating.
4. What is the debtor’s standing with the Secretary of State?
Is the debtor in good standing with Secretary of State? If the debtor is listed as “Dissolved” and the debtor’s phone number is disconnected, it is likely the debtor is no longer operating. In this case, your chances of collection could be low.
5. If the debtor appears to be open and operating, but you’re still unsure?
Hire an investigator. Many times, we have an investigator physically go out to determine if the business is still operating. An investigator can get a glimpse as to whether the business is operating, are there cars in the parking lot? Is there a sign on the door that the business is closed or relocated?
A creditor often incurs time and expenses in attempting to collect a debt from a business. Therefore, it is important to determine if a business is open, operating, and viable. An open, operating and viable business is a collectible business.