Take action before you lose money to bad debt
How is that customer going?
You know; the one that owes you a lot of money!
What would happen if they didn’t pay you?
How would that affect your business?
Shark Patrol was very effective in reducing bad debt by 60 -80% and there is no reason that you should not be able to achieve the same sort of results.
The key is monitoring your debtors ledger and acting quickly.
If your terms of trade say payment is due on the 20 of the month following and you have not received payment by the 21st get on the phone. Don’t send a “Nice” email or impersonal txt message. Get on the phone and phone every day until they pay.
If you do this from day one you are setting the standard that you expect them to keep. They will soon get the message – they will hate receiving your phone calls as much as you hate making them.
Never make a promise you can’t, or don’t intent, to keep!
If after two failed promises to pay and your customer hasn’t, then tell them – promise them – that if they don’t pay within 24 hours you will pass the invoice onto a debt collection agency. Again we come back to your Purpose Written Terms of Trade that will (should) have a clause that states very clearly that the customer is liable for any and all debt collection fees. So it won’t cost you a cent.
But if you make that promise to pass the invoice over to a debt collection agency you must keep it! No question.
Now I know some of you will be thinking I can’t do that. I can’t come across all heavy handed it might frighten them away. Well think about this for a moment; lets spin that argument on its head – what if you were a day late with delivery, let alone 30 or 60 days would your customer put up with that.
And what about your really nice bank manager, is s/he so nice when you are a day, or 60, late with a loan payment. A loan payment that’s bigger then it should be because of out standing debt. So man up, take firm action and get your money back.
Oh and don’t pass the task of phoning your over due customer to your receptionist or office junior. Unless they have specific training in debt collection they will be fobbed off and it will increase the time taken to get paid.