You do not need a collections department. You do need a system, because without one agreements slip quietly through the cracks and you find out in November that nobody followed up on an August default.

Here is a workflow a shop with one or two staff can actually sustain.

Step 1: Record at the point of sale

The agreement is created before the goods leave the shop, never afterwards.
The rule: If the customer is standing in front of you, capture identity, terms and the first payment now. Details collected later are collected badly, if at all.

Step 2: Check the schedule on day three

Three days after each due date, look at what has not arrived.

• If paid: Nothing to do , the record updates itself.

• If not: Send the first reminder immediately. A reminder on day three resolves most cases; the same reminder on day thirty rarely does.

Step 3: Escalate on the agreed path

Past the grace period, apply the penalty and escalation steps exactly as written in the agreement. Because the customer agreed to them at signing, this is administration rather than confrontation , and it stays that way as long as the steps are followed in order and on time.

Step 4: Review every Friday

Twenty minutes, same time each week, on the full overdue list.

• Identify everyone who is late and how late they are.

• Decide one action per customer: remind, reschedule, or escalate.

• Do not let an overdue agreement drift into another week without a recorded action. That single habit is the difference between a recovery rate near 98% and one you would rather not calculate.