Tag Archives: debt collection calls

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?

C2C Resources: Balanced and Fair in Debt Collections

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C2C Resources Debt CollectionMost of us have experienced a cash flow problem at one time or another.

If you’ve made more than a few collection calls, you know; it’s the number one reason for non-payment.

Even the most organized and conscientious customers can fall behind due to cash flow problems. The difficulty you face is that you have a business to run, too. How do you remain fair and balanced with good customers who are experiencing a tough time, while also being fair to your own business?

It’s possible to work with a past due customer in ways that are fair to you both. Start by allowing your customer plenty of time to tell you about the problem in as much detail as he/she will offer. Carefully listen and make notes so you can verify claims when you get off the phone. Demonstrate that you understand what’s been said by repeating the problems back to them.

If your customer offers payment solutions you’ve not thought of, remain flexible and open to ideas. If their idea for payment seems fair and reasonable for you both, put it in writing and have him sign it.

There’s always the possibility that your customer may suggest a payment plan that simply isn’t fair to you or your business. Perhaps you find it impractical or unreasonable in some way. In that case, you may find it helpful to further verify claims through other creditors who are also not being paid before you make any decisions about a payment plan. This may help you determine just how flexible you should be and if you truly want to continue doing business with this customer.

UPDATE: We add this strategy …

In your own mind, frame your collection call this way: You are a problem solver, ready to help your customer get this past due invoice off his back. It’s a financial burden! He wants freedom from it! You can help him get there by being ready with your own ideas for ways to solve the debt.

The more you demonstrate your willingness to work with your customer, the more likely you are to retain him even through this tough spot.

Take your in-house debt collection practices further with this powerful C2C Resources Debt Collection Advice.

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?