3 Things That Will Improve Your Debt Recovery Success Rate

As a business owner you know that every customer is different. They all have different needs and approaches, and part of your role as a service provider is to be flexible and give them the best solutions for their success. But things might not always go to plan, and one day you may find yourself needing to have difficult conversations about finance or overdue invoices with them. Being able to have those conversations effectively is key to effective debt recovery, and today we’ve got 3 tips to share that will make them easier.

Be Aware Of Your Tone

Emotions can run very high when money is involved. Even more so if the client who owes you money has been difficult all along. But it’s important that you don’t let any of that frustration come across when you’re talking to them. Whether it’s on the phone, via letter or email, make sure you’re staying calm and collected. Try not to lose your cool or get snippy with them. All this does is make you look bad and reduce the chances that you will get paid at all.

Remember that a lot of the time the person you’re dealing with isn’t directly responsible for the late payment. They may not have received sign-off to pay you, or be waiting for payment from a third party.  Be understanding, polite and friendly, while still being firm and holding your ground. Be clear and serious about the problem and what the various courses of action are, and what consequences they will face if payment is still not made. You’re much more likely to see results from this approach than ending up in a shouting match on the phone.

Provide Solutions, Not Problems

More often than not, clients who are struggling to pay on time are already experiencing financial problems, either in their personal lives or their businesses. The last thing they need is another person pressuring them to pay up.

We’re not saying you shouldn’t ask them to pay you, or that you should walk away from the debt. Instead, what we’re saying is that you may be more successful if you take a different approach, like offering them a helping hand and providing them with some debt recovery solutions. If they’re comfortable doing so, try to discuss the issue that’s causing the delay and see if there is anything you can do to resolve the issue at your end. If they’re experiencing financial problems, can you offer a payment plan, or take partial payment? If they have trouble with a specific payment method, you could offer a different way for them to make the payment.

It all boils down to this. When you approach them to talk about the debt, come with solutions, not just the problem.

Take Time To Prepare

Above all, make sure that before you write that email or pick up that phone, you have done all the preparation you need to have this conversation. That means checking over the entire client record so that you know the whole history, what communication they’ve had in the past, and if they’ve had any payment problems in the time you’ve worked with them. Confirm whether or not they had been given dates and times to act by, and if they confirmed agreement with those terms. Check if that date has passed, and what your next recovery steps are in line with that agreement.

Then, prep what you’re going to say, and the answers to any questions that might arise. Arm yourself with all the information you might need during the conversation and make sure you have it to hand, so that you can stay calm and collected the whole time. Keep copies of all of your numbers and documentation in front of you so that you can easily reference it and provide accurate information. If the client asks you something you don’t know the answer to, make a note of it and assure them you will get back to them with a solution.

If you feel like the debt recovery process is getting out of control, or you’ve exhausted all your internal resources with no success, it may be time to call in the professionals. At Debtcol we work with businesses of all shapes and sizes to provide tailored debt recovery solutions, as well as proactive support to minimise late payments throughout the business. If you would like to know more, just get in touch with the team today to book your free consultation.