How To Deal With A Disputed Invoice
Introduction
Disputed invoices are a common problem for businesses. Whether it’s a disagreement over goods or services supplied, disputed invoices have the potential to take up valuable time, affect cashflow and damage business relationships. In this blog post, we will look at how to deal with a disputed invoice.
What Is A Disputed Invoice?
A disputed invoice is an invoice that a customer or client disputes. Disputed invoices usually arise where there is a dispute relating to a contract for the provision of goods or services.
The most common reasons for disputed invoices include:
- Pricing discrepancies.
- Billing errors.
- Goods or services not delivered, as expected.
- Poor or unclear documentation.
- Timing or date issues.
- Contractual misunderstandings.
- Unauthorised charges.
- Currency or payment method issues.
- Communication breakdown.
How To Deal With A Disputed Invoice
Dealing with a disputed invoice is a difficult task, particularly if a customer or client is acting unreasonably. However, there are a number of strategies you can deploy to try and resolve the situation.
Review The Dispute Objectively & Show Some Empathy
Try to review the disputed invoice objectively and analyse the situation without emotion or any bias. Consider all angles and use logic to inform your decision making.
It is also important to show some empathy. This means listening to your customer or client and their concerns. If roles were reversed, would you pay the disputed invoice?
Communicate Promptly
Prompt communication is vital when dealing with a disputed invoice. This means you should:
- Acknowledge receipt of the dispute as soon as possible.
- Set a timeframe for resolution.
- Carry out an investigation immediately.
- Inform your customer or client of the outcome.
- Resolve the situation as quickly as possible.
Gather Supporting Evidence
Supporting evidence is very important with disputed invoices. It can significantly improve your negotiating position. This means you should gather together:
- Contractual documentation, including any terms and conditions.
- Purchase orders.
- Statements of work.
- Delivery notes.
- Time sheets.
- Previous correspondence.
Make An Offer Of Settlement
Disputed invoices can consume a lot of time. And in business, time costs money. For this reason, it is often sensible to make an offer of settlement.
Seek Early Assistance
The businesses that deal with disputed invoices most effectively often seek early assistance from a firm of debt collection solicitors. Debt collection solicitors such as Bennett Williams Solicitors can help you to use pre-action protocols to your advantage.
Consider Alternative Dispute Resolution
There are a number of methods of alternative dispute resolution that are available when trying to deal with a disputed invoice. The most common are negotiation and mediation.
Alternative dispute resolution can often help you to:
- Save time.
- Save money.
- Gain peace of mind.
Issue Court Action As A Last Resort
If all else fails, you should consider issuing court action. If a resolution is not possible, a judge can determine whether a disputed invoice is payable or not.
Preventing Future Invoice Disputes
The best ways to preventing future invoice disputes typically involve:
- Performing a contract in accordance with its terms.
- Excellent customer service.
- Prompt invoicing.
- Clear communication.
- Effective credit control.
Conclusion
Disputed invoices are a major cause of late payment in both business to business and business to consumer transactions. For this reason, it is important to know how to deal with a disputed invoice.