HOW TO MAKE RECEIVABLES/DEBTS HARDER TO COLLECTPosted by: Zipporah Gikonyo On October 25, 2018
No one really WANTS to make their receivables harder to collect, but during our debt collection activities at Credit and Debt Management Services Ltd, we frequently see evidence of companies and businesses doing just that!
The following are mistakes that make your debts hard to collect;
- Customers not filling out credit application forms- All new and old customers should fill credit application forms and terms and conditions outlined. Proper KYC should be conducted.
-Not credit checking your customers- Defaulters referred to our debt collection agency are already in our system having been forwarded by other credit providers where they have defaulted. Check your customers with the CRB.
-Failing to communicate your credit terms to your customers from the onset of the relationship.
-Repeatedly incorrect invoicing- avoid a reputation of sending wrong invoices to your customer. Ensure accuracy in all your invoices.
-Taking long to deliver the invoice to the customer- Avoid laxity when it comes to issuing invoices to your customers if possible issue an invoice immediately after offering a service or after actual billing has been established for postpaid services.
-Failure to monitor customer payments- Keep monitoring customer accounts and follow-up for payments on all due accounts.
-Not sending statements to customers regularly- if you want to get paid ensure customers get their monthly statements without fail rest they forget they owe you.
-Not contacting your customers immediately their account is due.
-Being afraid that you will lose your customer for asking for payments. If you allow the fear of losing customers dominate your mind, customers will dictate when to pay you and you will have a cash flow problem.
-Delay resolving disputes- you cannot get paid without resolving a dispute. Prioritize on resolving a dispute to ensure timely payment.
Minimize the above mistakes and you will see an improvement in cash flow and fewer problem accounts. Always remember a sale is a cost until it is paid for!!
Have a good read!
For debt Collection services please feel free to contact us.