Collecting Money owed from your Customers

Collecting money from customers is  simply not an enjoyable job.  It takes much energy and patience.  Some people believe when asking  customers for money they owe they will be offended.  No one wants to offend and risk losing customers. They are the lifeline to businesses so one can put ‘bread  on the table.’

So here are some tips in asking customers to pay invoice(s).

  1. When initially sending an invoice, call the accounts payable person of the customer’s company stating you are sending the invoice and ask if the e-mail, mailing address or fax number is correct before sending the invoice so you know they received the invoice.
  2. If your terms are net  30 days and the invoice is not paid in the 30 days then send the invoice again with a message giving your customer the benefit of the doubt.  You can state for example, “I know you are real busy or perhaps it was a simple oversight,  but our records  show you owe us for the attached invoice.  Please make payment to us at this time.  If you are unable to pay it all, please pay half now, half next month.”  You can also design a payment plan for individual customers based on their circumstances.
  3. If you still have not  heard from the customer in 60 days, then call the customer.  Be patient and understanding, let he/she explain why they have not paid or cannot pay.  With listening,  you can go a very long way.  Their explanation can give you ideas for payment plan you can work with him/her.  Also, by listening, you are giving he/she a chance to vent which may calm him/her down and it shows you care.
  4. If you still have not received money after 90 days, then you might need to negotiate even if the amount was agreed upon at the time of sale.  Due to our current economic situation , many people may have had every intention of paying their bill in full or on time, but circumstances beyond their control have prevented payment(s).
  5. When negotiating, understand the process, focus on a win-win solution, be patient, be confident and develop your listening skills.

Again, you would just like to be paid for your hard work and keep the ability to put ‘bread on your table.’  If you need to negotiate the fees even though this was not your initially intent, you will likely receive the majority of the money expected which is better than nothing.  Also, when the economy brightens, you will still have this customer.

If you would like to learn more about this strategy, please call Susan at 847.895.9880.