Are there legal problems looming?
As soon as you see a client in legal problems, filing for bankruptcy protection, liens, or anything of that sort, that client should immediately go on COD terms.
Your first danger signal in commercial collections is any indication that the customer is starting to have legal problems. It often does not make sense to cut off supplies to the client, as they need to make money, to earn the money that they owe you. COD, or Cash On Demand, is often a good compromise to continuing to do business, even though there are legal problems.
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