Collection Skills Training Magazine Section

Collecting your Debts

Eight Tips for Collecting Debts. Debt Collection TrainingCOLLECTION SKILLS TRAINING - DEBT COLLECTION

 

Consider the following eight points when collecting from your overdue customer:

 

 

 

01 BE PREPARED

 

a)...know thyself!

There couldn't be a better way of wasting a phone call if you were not physically and mentally prepared to make that phone call. Emotions can be very easily read over the phone. So be eager to collect the money. After all it is your money! 

In your call be prepared to Express Urgency! Remember if you are not eager to get paid, why will your overdue customer be eager to pay you. State your urgency regarding the overdue debt by soaking it with emotions. Also, be prepared for some retaliation. After all it is the nature of the beast! Hence, be positive and make the person on the other side of the phone see the merits and the positive sides to paying their debt on time and also explain the consequences of non or late-payment. Psyche yourself for the call and at all times maintain a professional approach. 

 b)…know thy customer!

 Understand the impact of this customer to your business. Both in terms of size and cash flow. Study the history and payment trends of this particular customer. Know the exact amount and reason for the overdue amount. Remember, when you make the call, ask for the full amount and do not assume that there is a problem. Many collectors make the mistake of asking ‘Is there is a problem’! 

Know the decision-maker and speak to him or her. The size of the company will determine who your payment decision-maker will be. The smaller the company the higher the level of decision-maker. Involve a decision-maker, because you expect a quick decision and a commitment that in future your invoices will be paid on time.

If their Payment Pattern has changed take immediate corrective measures. Investigate the reason because it could be the beginning of some concerning cash flow problems. Show concern as a business partner but assert the fact that the payment is overdue and that you expect to get paid on time, each time.

02 ASK QUESTIONS

Questions convey to your customer that you are concerned. Questions also provide you important information for leading the discussion and controlling it. Questions also yield information or reference material for future reference. Ask open ended questions and when the conversation requires it ask leading questions. If time is being wasted then perhaps start closing with close-ended questions. Keep control!

03 LISTEN

If you are asking questions the tendency is to get distracted with asking and thus forgetting to listen! Don’t just listen to what your customer has to say but listen to the surroundings, the tone of your customer, the sincerity etc. Active listening requires being more imaginative than mere casual listening. Paraphrase and summarize your conversation. Clarify and state clearly your expectations from the customer. It shows that you care and listen and that you have clarity of thought. 

04 MAKE NOTES

Memories are mighty short! There is no substitute here, talk with a pen and paper in your hand doodle, if you have to, and keep writing. Your notes could even save the day one day when you need them. Hence, preserve them electronically or otherwise where it becomes part of customer history. Let others in the company, especially sales, have access to your notes.

In your follow-up calls get progressively firm if the need arises. Be assertive and not aggressive.

05 BROKEN PROMISE(S)

There is an adage in collections: ‘If they break three promises they will break thirty’. Broken promises are to be taken seriously. Promises are made on both sides yours and the customer’s. If you made a promise like ‘Calling at a particular time’ or ‘ Investigating a certain problem within a certain time frame’, then keep your promise! There is nothing worse than loosing credibility. Say what you can do and not what the customer needs to hear. Credibility is one of the most important aspects of a collection call. Make sure that the company will support your actions before you talk about them to your overdue debtor (customer).

If a customer breaks his or her promise then take immediate action otherwise again your credibility will be at stake and don’t be afraid to point fingers at the customer for demonstrating poor credibility. 

06 AVOID ARGUMENTS AND THREATS

A debtor can easily push you into an argument and drive your attention away from the your key objective of ‘getting-paid immediately’. Stay composed and focussed. In the profession of collecting debts it is easy to get aggravated, emotional and flustered. Getting into an argument is tempting . Do not allow your customers to lead you, be firm composed and guide yourself. Use your leverage as a last resort. 

07 OBJECTIONS

The objective of your call is to get the full amount paid NOW! You could be faced with a barrage of objections in achieving this objective. Treat every objection as an ‘Opportunity’ to get a commitment for full payment. Establish with your customer that the objection that they are posing is the only one and if that objection is dealt with then there should be immediate payment. Get the commitment on getting paid on an objection. 

08 WORK SMART NOT HARD

Use the resources available to you effectively. If you really want to be successful in collecting those debts then get the salesperson involved too. Make friends with your salesperson. 

The quality of your collection effort counts and not the quantity. If you subscribe to a collection agency then use them effectively. Some of them provide you with collection stickers. Use these on your correspondence or overdue statements. It adds extra leverage to your collection efforts. 

 

Finally, remember that when collecting, you are dealing with your business partner. Customer Service is an integral part of a collector’s job. Enjoy what you do and the monies from your overdue accounts will follow. 

 

Our website is protected by DMC Firewall!
This website uses cookies to ensure you get the best experience on our website.