Overdue customer keeps ordering: should you stop supplying them?
The invoice is 45 days overdue, and today an email arrives with a new purchase order. It is the same customer, the same friendly tone and a bigger order than usual. Supplying it feels like good business. Refusing it feels like picking a fight. Either way you are making a credit decision, and it is better made on purpose than by default.
This guide helps you decide, and shows how to put the decision to the customer without losing them if they are good for the money. For the steps before this, see what to do when a customer keeps promising to pay.
Why this is a bigger decision than it looks
Every further delivery on credit adds to what you are chasing. If the customer is struggling, the new order is the one most likely to go unpaid too, and it will arrive just as their cash is running out. Meanwhile the old invoice gets harder to prioritise, because the account looks active and the customer is still talking to you.
There is a second cost. A customer who can keep ordering while ignoring an invoice learns that overdue accounts carry no consequences. The late payment spreads from one invoice to all of them.
Four questions to ask before you reply
- Is the old invoice disputed? If the customer has raised a genuine problem, sort that out first, and keep the undisputed parts moving. Our guide on customer disputes covers this.
- Is it a one-off slip or a pattern? A first late payment from a good customer is not the same as the fourth.
- How big is the exposure? Add up everything unpaid, including work in progress, and compare it with what you could afford to lose.
- What do your terms and any contract say? Some agreements let you pause supply for non-payment. Others do not. Check before you act, not after.
Your options
Supply as normal. Reasonable only where the delay is small, the cause is known and the exposure is modest. Set a date for the old invoice to clear.
Supply with a condition. Deliver the new order once the overdue amount is paid, or in part, with a dated plan for the rest. If you take a plan, see whether to accept instalments for what to write down.
Supply against payment. Ask for payment in advance, or on delivery, for new orders only, while the old balance is chased separately. This protects the new money without ending the relationship.
Put the account on stop. No further supply until the overdue balance clears. It is the clearest message you can send, and the right one when the customer has ignored several chasers or the balance is already large.
Put the decision in writing
Whichever option you choose, say it in a short message that the customer cannot misread. Include:
- the invoices that are overdue, with amounts and due dates;
- the date by which you need them paid;
- what you will do with the new order, and what you will need before supplying it;
- how to resolve it, whether that is a call, a payment or a plan.
Keep the tone matter-of-fact. This is a rule about your credit, not a verdict on the customer. A message of this kind also becomes part of the record, which matters later: it shows the date you stated the amount and told them what would happen next, the same record you would build for a letter before action.
Do not mix the two conversations
It is tempting to use the new order as leverage: pay the old invoice and you can have the new goods. That is fine as a condition, but keep the old debt on its own track. If the deadline passes, move to a formal letter without waiting for the next order to settle it. If the customer then pays the old balance only to run up a new one, you are back where you started, with a payment history to show for it.
If the customer’s behaviour suggests a bigger problem, such as unanswered calls, a changed contact or hints of cash trouble, read what to do if the company is insolvent or dissolved before you extend any more credit.
When the balance is already too big
If the account is large, the customer has stopped replying and each week adds to the exposure, stop supplying and escalate. A letter before action sets a final deadline. If that is ignored, instructing a debt collection agency is the usual next step for an undisputed debt owed by a trading customer. You can compare vetted UK debt recovery agencies on Collect Compare, with names hidden until you choose, or let us match you. It is free for creditors: the agency you choose pays for the introduction, and no agency can pay to rank.
The short version
- A new order from a customer who owes you is a credit decision. Make it on purpose.
- Ask whether the debt is disputed, whether this is a pattern, how big the exposure is and what your terms allow.
- Choose between supplying, supplying on a condition, payment in advance for new orders, or a stop.
- Put it in writing, with dates, and keep the old debt on its own track.
- If the deadline passes, escalate rather than wait for the next order.
This is general information, not legal advice. Your right to pause or refuse supply depends on your contract and the facts, so take advice on your specific case.
Frequently asked questions
Can I refuse a new order from a customer who owes me money?
It depends on what you agreed. A framework or supply agreement may oblige you to keep supplying, or set out how you can pause, so check your contract and your terms of trade before you refuse, and put the reason in writing.
What if they say they will pay the old invoice when the new goods arrive?
That is a reason to ask for the old invoice first, not a reason to supply more. Offer to deliver the new order as soon as the overdue amount has cleared, or on payment up front, and keep the offer in writing.
Does putting a customer on stop damage the relationship?
It can, but a calm, written message that explains the rule and the way back is usually received better than a sudden refusal. Customers who intend to pay tend to respond. Those who do not tell you something useful by their silence.
Should I tell the customer before I stop supplying?
Yes. A short written notice that further orders will be supplied only on clearing the overdue balance, or on payment in advance, avoids a dispute about why a delivery did not turn up. Say what they owe, by when, and what happens next.
At what point should I hand the overdue balance to an agency?
Once your deadline has passed without payment and the debt is not disputed. If the customer is also still trying to order, the balance is growing, which is one more reason to act sooner rather than later.
