Category Archives: How To Make Commercial Debt Collection Calls

Strategies for successful debt collection phone calls

What NOT To Do If You Want A Return Phone Call

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business-441002_640It’s tougher than ever to get through to a live voice on the phone. Caller ID and voice mail make it easy for people to screen calls or ignore them in lieu of a more convenient time. And getting a return call? Don’t hold your breath.

For collectors, that challenge is magnified ten-fold.

Communication specialists recommend all kinds of creative strategies to get a phone call returned. Of course, there’s no sure-fire solution and in fact, one idea we heard recently struck us as simply wrong: Leaving a bogus message that states that you’re returning their call.

Put yourself in the customer’s shoes for a minute. You’re extremely busy. You hear that message and assume that, because you can’t remember, you must have placed a call to this person as the message states. You spend the next 5 or 10 minutes racking your brain and flipping through notes trying to remember this person and why you called them.

When you do finally return the call, you realize you’ve been tricked. So not only have you wasted time trying to remember the initial phone call that never happened, now you’re caught off guard in a clear deception.

As the customer, are you going to feel any desire whatsoever to work with this collector?

Absolutely not. In reality, you’re more likely to put that bill at the bottom of the stack out of sheer anger and frustration.

No one ever says to a collector, “Oh! I’m SO glad you called!” By nature, these calls are adversarial. Therefore, collectors must find a way to overcome the negative stereotypes in order to make headway on the debt. Trickery and deception build walls and make the task far more difficult.

Don’t do it. No matter how many messages you have to leave for a delinquent customer, be truthful.

Internal Debt Collection Campaign Tips: What time of day is best to call?

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Your customer has not paid after the final past due notice. It is now time to tackle a debt collection call to figure out when you will be receiving your money. While we often discuss best practice phone etiquette and provide sample call scripts, many clients have inquired about the best time of day to call their clients to get the best results.

While there is no specific time or magic solution for calling and reaching a happy client on the other end of the line, there are several best practices you should follow when calling.

Get to know the person you are calling

Not only do you need to know the specific person to call, but you should try to form a relationship with that person.  If and when the client encounters financial troubles, you will have a deeper insight into their schedule. Keep notes on what business hours the person works, if they only work on certain days and any upcoming vacation time they will be taking. This could all provide helpful insight if you are calling their direct line and continually reaching their voicemail.

Call time can be influenced by business size

If your customer is a very small business, there is a potential that you could be in contact with the business owner instead of an accounts payable employee. If this is the case, try to call concerning collections early in the morning, around 7 a.m. Most business owners get to the office early to take care of business matters before being pulled into meetings. Remember, 7 a.m. is not a firm call time. It is always important to develop a relationship with the person you will be calling and use your judgment on whether a call before work hours is necessary.

First thing in the morning is better than end of the day

Collection calling is probably not the first thing on your to-do list that you want to do. Nevertheless, it is important to call early in the morning to reach people before they become busy with anticipated tasks and meetings. By calling in the morning you are more likely to get a same-day decision on a payment schedule, even if the client needs to contact you back later in the day.

What time of day is most successful for your business’s internal debt collection calls? 

Five Tips for Making Collection Calls that Get You Paid

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Debt collection calling is not the type of task most employees get excited about. Typically, in-house campaigns take employees out of their comfort zone. For most small businesses it is a task given to employees in addition to their normal job responsibilities. Don’t waste your time and money with an inefficient debt collection calling campaign. Instead, be successful from the start!

Here are the top five things to do when making collection calls:

Always prepare for excuses.

Unfortunately, most debtors will not be quick to offer payment options. Don’t allow yourself to get flustered by excuses. Instead, be prepared. Here are the most common excuses you will hear:

The check is in the mail.
How to respond: Ask for the date of the check, amount, address where it was sent and check number.

I never received the invoice.
How to respond: Always give the customer the benefit of the doubt. This is a great time to verify their preferred method for their invoice: email or mail. Always follow-up this discussion with asking how the customer will pay the past-due balance.

Our business is going through financial problems.
How to respond: Work to set up a payment schedule with the customer.

We completed the wire transfer yesterday.
How to respond: Ask for the routing and banking information. The customer could be telling the truth, but you need all of the information you can collect to verify the validity and make the most of the call. 

 

Do your research before the call.

Learn as much about the customer as possible before picking up the phone. Common information to find out includes:

    1. Has the customer had payment problems in the past or is this uncharacteristic?
    2. Did the sales person have concerns about the account?
    3. Terms of sale
    4. Payment due date
    5. Exact amount due

 

Always be professional.

Never threaten a customer for payment. The goal of the collection call is not merely to successful collect payment; you should try to also maintain the business relationship if possible. When on the collection call, follow these tips:

    1. Never multi-task. Be completely focused on the call.
    2. Speak slowly and take more pauses when you speak.
    3. Never eat food, drink a drink or chew gum while on the phone.
    4. Go into the call with a positive attitude. Your tone and inflection of voice will mirror your attitude.


Ask open-ended questions.

You will never get paid if you only ask questions with Yes and No answers. Let’s look at a scenario:

Option A: Do you plan on paying us soon?

Option B: What date can I expect payment from you?

Option B is obviously the better choice. You are committing the customer to a specific date. Make it a goal to commit the customer to something before getting off the call: full payment, partial payment, or even a date that they can let you know their payment plan (Remember, sometimes your main point of contact does not control the money within the business.)

 

Be deadline-driven, but still flexible.

Debt collection requires you to walk a fine line. You need to be assertive, but not too pushy. Always emphasize the urgency of the matter and try to have the customer commit to dates for payment.

 

What Makes a Good Debt Collector?

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Businesswoman making a call - C2C ResourcesAs a business owner, your collection call team will lead you to increasing cash flow. But is a good debt collector born with “it” or taught “it”? For small businesses and start-ups, finding the right person on the team is particularly important because often team members wear multiple hats; only needing to step into the role when needed.

We think the right person has a combination of the right personality traits and proper training. Don’t always go for the sales person or accounts receivable person on the team. While they may be directly related to the process, they may not have the personality needed to deal with potentially intense situations.

 

When considering a team member, look for the following traits:

-          Problem-solver: Often driven to find a solution, the problem solver is going to approach the situation with unique ideas. They will be results driven, even if the debtor becomes upset during the process.

-          Self-motivator: Getting on a call is nerve-wracking because the debt collector does not always know how the debtor will react. By having someone with a keen sense of self-motivation, they will be driven to get the work done.

-          Tenacity: If a debtor is persistent with providing reasons as to why they cannot pay, the collector will need to be just as persistent to make sure that the call ends with an action item of next steps in the payment process.

 

And, provide the following training:

-          Selling: The debt collector on your team needs to be able to prove to the debtor that they must pay. This is very similar to a salesperson’s role. By providing the team member with proven tactics you can prepare them for the most challenging calls.

-          Customer Service: While it may be a good idea to pick the most tenacious person on the team, they also need to have good customer service skills. Being too controlling during the situation could turn the customer off and lead to no payment. The ideal candidate would have a good balance.

Finding the right person on your team to handle debt collection calls goes beyond the ability to pleasantly interact with customers. It requires a combination of skills to be effective.

Do you have the right person for the job on your team?

Making The First Debt Collection Call

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Debt collection calls are hard to make. Before you’ve dialed the number, you already know that the call will be uncomfortable, at the least. The most important thing for you to do before the call is to focus on the goal of the call so you can keep the conversation on track.

The goal is simple: To get paid the same day. But in the process of achieving it, you also want to maintain good will so that your business relationship continues to thrive. To help you reach your goal while keeping a good customer, prepare yourself before you pick up the phone.

Your first task is to collect all the essential pieces of information you may possibly need during the call. Have the past due invoice in your hand. This way you’ll be able to recite the facts about the account accurately. You might even find it helpful to have a script in front of you to read from. The following is an example that briefly covers all the key elements of the reason for your call:

Hello, [his/her name] this is [your name] with [your company name]. I’m calling to follow-up on [invoice number] for [$$$]. According to our records it is [XX] days past due. Since we have still not received payment, I wanted to make sure that there was no problem with the invoice and if there is no problem, determine when payment will be made.

If your customer has a history of slow payments, consider changing the last words to: “… and if there is no problem, determine why payment has not been made.”

Naturally you’ll get different responses from different customers. You may have already experienced the typical response of, “Your check is already in the mail.” In that case, simply request the check number, the amount paid and when it was mailed. If the timing is such that the check should have reached you by the time of the call, confirm the mailing address. If it checks out, then it’s time to end the call with the assurance that you’ll check into it on your end and contact them for a reissue if the check isn’t located.

For your customers who promise to mail the payment that same day, your call can end positively with something like:

That’s great! As you know our terms are [net 30] and we try to make sure all of our customer’s accounts are kept current with full purchasing power. I’ll watch for the check in the mail over the next few days.

Customers who are evasive require very firm and specific responses from you. Consider the following as a possible call script for such a customer:

As you know, our terms are [net 30] and this invoice is now [XX] days old. What can be done to expedite this payment and get it in the mail today?

Being firm and yet flexible will serve you well.  There are times when it’s not possible for your customer to pay you the same day as your conversation. In those cases, set a date that does work and then follow up with a phone call if you don’t receive a check by that date.

How about it? How do you prepare for a debt collection call?

3 Ways To A Successful Collection Call

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Follow these 3 steps for a successful collection call

Businesswoman making a call - C2C ResourcesDebt collecting has its challenges. As the collector, you have your set of hurdles. Your past due customer has his. Both perspectives represent real people dealing with financial stresses – just trying to make the business work.

We rely on one another to follow through when engaging in business. Making collections calls takes a little finesse if we want to maneuver successfully through our challenges to reach a resolution. You want 2 things: To be paid and to retain the customer.

Your main objective in a collection call is of course, to be paid the same day, in full. To get there, put the following three things into action during your call.

1.    Listen intently
The more information you have about the circumstances your customer is facing, the better you’ll be able to help her resolve the debt. Give her the time she needs to explain the situation to her satisfaction. On your end, take notes and repeat the key points back to her. Consider the time this takes as an investment in your business relationship.

2.    Remain calm and professional
Regardless of how frustrating collections can be, most customers truly want to pay you. Their debt is nothing but a monkey on their back that they want gone. Typically, just listening to them talk will tell you who falls into that category. These are the kinds of customers who will respond well to helpful, useful solutions or agreements and are most amenable to your ideas.

But regardless no matter how your customer responds, staying calm and remaining professional is always the best route to take. If things heat up ~ keep your cool. Your calm responses have the potential to defuse an escalating conversation.

3.     React with firm flexibility
When you respond to your client with firm but flexible options, you open to doors to options in tough situations. This can be a relief to both you and your customer, because the fact is, while a same-day resolution is desirable, it’s not always attainable. Your customer may suggest ideas that may not be the most desirable for you. But if you’ll remain flexible and open, you may find solutions you’ve not thought of before. Once you come to a solution, be firm about the follow through.

Are your collection calls yielding results?

3 Ways To Make Debt Collection Calls Easier

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Calling your customer about a past due invoice can be one of the most challenging aspects of operating a business. It’s not unusual for aged accounts to pile up because business owners are uncomfortable making debt collection calls. There is a way to ease some of your own apprehension though. By doing the following 3 things, you may find the calls just a little easier to make.

1. Write down excuses

Before you pick up the phone, sit down and list out the most common reasons and excuses for non-payment you’ve heard in the past. Once it’s completed, think about your possible responses and write those down next to the excuse. Think about what worked before and what didn’t.

As an example, I’m sure you’ve heard the excuse, “The check is in the mail.” And while you hope that’s the case, you can’t know for sure, so you’ll want to press for a more concrete verification. Consider a response like, “That’s good! May I have the check number, amount and date sent so I can make sure it posts correctly?” A response like that isn’t confrontational and may result in a speedy debt recovery.

Silly as you may feel, consider rehearsing your responses out loud. This will help you think on your feet throughout the conversation.

2. Know the details of the past due account

Have the following information at hand in advance of the collections call. This will help you maintain control of the call.

How much is owed?
What are the terms of the sale?
What did they purchase?
When was the payment due?
Are there numerous open invoices?
What is their payment history with you?

3. Put yourself in a positive state of mind

A positive disposition and friendly tone of voice will help to set a good tone for an uncomfortable collection call. Take a few minutes to think positively and prepare your self for a professional, pleasant and respectful conversation. Set yourself on a slow and steady course, prepared to leave ample time for listening to your customer’s point of view without interruption.

Half the battle of making a successful debt collection call is the preparation you do before hand. Feeling like you have all your bases covered before you begin the conversation will set you more at ease and help you stay in control.

How about it? How do you prepare for collection calls?