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What to Do When Customers Don't Pay

Protect yourself.

By
This story appears in the October 2016 issue of Entrepreneur. Subscribe »

Mitchell Compton II's success was starting to freak him out. He cofounded the San Diego-based Coconut Beach, which sells a line of coconut chips and drinks, and debuted the products at a natural-foods trade show in March 2015. Orders came in rapidly; he soon got up to $1 million in sales. But then he started wondering: How reliable are some of these people? "We had to figure out how to mitigate our worry over not getting paid in a timely manner, or at all," Compton says.

Chris DeLorenzo
Mitchell Compton

Related: How to Check a Customer's Credit Worthiness

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