Have an attorney--preferably one who specializes in creditors' rights--review all your documents, including credit applications, sales contracts, invoices and statements, to ensure they conform to your state's regulations.
For instance, invoices should state when the payment is due. If you offer terms, you must clearly state the interest rate and conditions under which interest accrues. In some states, customers must agree to this in writing; find out if this applies to you. Also, stipulate that if there is a problem, the debtor is responsible for paying any attorney and collection fees.
Do yourself a favor: Protect yourself now, and collections will be much easier later.
Excerpted from Get Smart: 365 Tips To Boost Your Entrepreneurial IQ
For reprints and licensing questions, click here.