The Art of Business Debt Collection
Is your business owed money? Do you want to be paid promptly? Of course, you do. Revenue Assurance Partners, LLC has over 100 years of combined experience in debt recovery and would like to offer some advice in getting your customers to pay you quickly.
Businesses that are owed money view the situation from a business point of view. Businesses are operated with a rational and logical mindset. Those that are negligent in paying their debts are not thinking logically on this matter, so we suggest taking a different approach with them.
The factors involved
The amount of money involved the financial situation of the consumer, the format of your invoice, and the existing relationship with the customer influences the promptness of payments. It is more beneficial to approach the situation attempting to view it from the customer’s perspective.
Having a good relationship with a customer that has the ability to pay their debts is an optimal situation for those owed, but the structure of the invoice is often overlooked. Most businesses overlook the fact that making the paying process easy will inspire those in debt to pay more quickly.
Use the invoice to your advantage
The invoice should be clear and easy to understand. This means having a consistent format, having job numbers, being free of industry jargon, having big and clear type, etc. The more difficult an invoice is to discern; the longer customers will wait to address it.
Engineer the invoices so payment will be more likely. For instance, make it very clear as to when the payment is due (do not use abbreviations). If there is a possibility of making a deal to get paid more quickly, then do it (example: “$20 off this invoice if paid by April 4”). Most customers will be prompted to pay their debts right away if they can benefit.
Use other factors as leverage
Most businesses will bill towards the first or middle of the month. This means that a customer will get their bills in clusters. If possible, send bills to arrive in between these dates. It is much less intimidating and more likely for someone in debt to pay a bill when it comes idly than amongst many.
Create the option of customers to pay online. It is much easier to pay a bill online rather than filling out a check, getting postage, and then mailing it. An important aspect is to present the option of setting up an automated payment method. If a customer can simply log in their credit card or checking account number one time and have their owed money drafted with each purchase it will be much easier (this is especially true for regular buyers). When possible, create the option of having the customer choose the draft date from their card or account.
Debt Collection by Revenue Assurance Partners
Revenue Assurance Partners provides business with over 100 years of combined experience in collecting their money. Our years of experience have given us the insight, knowledge and power to know how to address your debt to get you paid quickly and seamlessly. Most problems can be avoided before they start, let us help you.