July 6, 2015

Collecting Overdue Accounts

Collecting overdue accounts – what a job – nobody likes it but it is a part of usual business practice.

You’ve done the work – now you want to be paid. Debt Collection is not a fun part of the job.

You wait for payment – silence breeds fear – your frustration builds as payment of your account does not develop.

The reality is the next phase – you might never get paid for the good work that you have done.

So you need to decide what you want to do – what your course of action will be.  Collecting overdue accounts may be a novelty at first but once the novelty wears off – what is your strategy.

You’ve qualified your client – you have disposed of the client types you don’t want – but in the end your business, like any other business, will have some bad payers. So consider how to approach collecting overdue accounts in the context of setting reasonable time limits so that your precious time is not entirely dedicated to chasing unpaid accounts.

So what are the practical steps you can take to collecting overdue accounts?

Your options – lengthy and possibly costly legal action or use a legally based Debt Collection Letter Series.

First, let’s identify ‘why you aren’t getting paid’.

Generally, non-paying clients will fall into 1 of 3 categories.

  1. He doesn’t have the money right now.
  2. He isn’t happy with your product or service and refuses to pay.
  3. He has spent the money elsewhere.

Understanding which of the categories the non-paying client falls into will be a key to successfully collecting overdue accounts.

Speak to your client if you see value in this approach.  Don’t be afraid to take the first step and call the client to ask why your account has not been paid.

Reminders are OK but are quickly put to one side. Calling to speak to your client and putting him ‘on the spot’ will require your client to provide answers or hopefully to make a commitment to pay the account.

Identify which category your non-paying client falls into – make that important telephone call and if payment of your account has still not been made then you can develop a strategy for recovering your money.

With the ‘can’t pay client’ this may simply be a matter of arranging a payments plan that you can then monitor.

With the ‘not happy client’ you can at least identify the issues and make a call as to whether or not there is justification for the complaint/s. If a review of the account is justified, then you can make that call on an informed basis.

With the ‘I won’t pay client’ nothing more needs to be said.

If a sensible resolution of the account cannot be achieved then, simply download our E-Book and use our legally based Debt Collection Letter Series. If free and it’s there to assist you.

If the letters don’t work, then contact us.