Debt in the Beauty & Aesthetics Industry
There are many clinics now offering credit to people for courses of treatments as well as payment plans to make them even more accessible to a wider audience. With these options comes the risk of bad debt and people defaulting on their payments.
The number of British citizens undergoing cosmetic surgery in 2016 fell to its lowest number in a decade, falling by 40%. Meanwhile the number of people seeking non-surgical procedures continues to steadily increase. The medical aesthetics industry has been booming for some time and is no longer the preserve of the famous or wealthy. Since the discovery of Botox as a preventative treatment for the early signs of ageing to the prevalence of lip-fillers, facial-fillers and facial peels, non-surgical aesthetics treatments are now a mainstream industry that is accessible to millions of people globally.
The industry is worth £3.6 billion in the UK and is continuing to grow. Due to economic uncertainty after the recession in 2008 and the more recent EU referendum, people are more likely to scale back large spending on significant alterations and opt for more affordable non-surgical work. The surges in demand for these procedures can also be partly attributed to the rise of social influencers such as Kylie Jenner admitting to using these services as well as the non-permanent nature of the treatments.
There are many clinics now offering credit to people for courses of treatments as well as payment plans to make them even more accessible to a wider audience. With these options comes the risk of bad debt and people defaulting on their payments. The industry, although outwardly robust, is also very vulnerable to market volatility. If there is large economic downturn, or increased uncertainty, then demand can suffer. This means that it is imperative that these clinics maintain a healthy cash flow to see them through any drops in demand. Offering credit and payment plans is an effective way to get people through the door and using the services, however, it can leave a company vulnerable if there are a large amount of people defaulting on the debt.
Recovering this money as quickly and efficiently as a possible is vital to maintain the long-term viability of the company. Tying up staff and wasting hours trying to recover the money is not an efficient use of company resources and can often end in frustration. Using a reputable agency to recover these debts on your behalf can minimise the time taken to recover the monies owed and ensure that cash flow remains healthy. A lot of the treatments in the aesthetics industry last for around 3 months and lots of clients are repeat customers and so you need to ensure that the relationship between customer and clinic is not damaged. There may be a genuine reason that your customer has been unable to pay and using a company that will take the time to find out what the problem with payment is, and then resolve it to the satisfaction of all involved, means that you can protect that relationship and still be paid.
Daniels Silverman has years of experience of collecting this type of debt, while working hard to protect both your reputation and your relationships. For help with this, or any debt problems, get in touch and see how we can help.