Don’t let a good business relationship turn sour because of debt — what do you have to do when the need arises?
Every business has encountered this scenario in one way or another – that of having good customers with a proven track record with your company but is not able to pay their debts on time.
No matter how loyal, how rich, or how diligent a customer is, there could always come a time that they would miss out on payments due to a multitude of reasons. Whenever this happens though, it could impact your business since this results in possible problems to your cash flow, and could hurt your bottom line if left unchecked. The problem with this is that these are good customers who can bring you more business in the future, keeping the wheels of your company churning.
What would be the best way to approach this conundrum?
The Reason Why
Whenever good and long-standing customers aren’t paying off their bills on time to you, the first thing to do would be to find out why.
There are so many possible reasons for their late and non-payments including financial hardships, transaction and bank issues, and even natural disasters. Instead of directly threatening or even taking legal action against these customers, as a responsible business owner, you should first try and open a dialogue with them to reveal the reasons for their non-payments before taking things any further than needed.
Each credit setup could be different for each customer depending on the amount and the financing that is being utilised. For example, if the payment scheme that you follow is a monthly one, but your customer always makes payment bi-monthly, try to wait until the customer’s normal cycle has passed. Only after one full cycle of the customer’s payment schedule should you then look further into the matter.
In fact, if the main reason your customer isn’t able to pay you on time is due to having to pay other creditors at the same schedule as well, you can change the payment schedule you have set up. This would put you ahead of other creditors and would free up your customer from more stress due to having to pay several bills all the same time each month.
Bills and Billing Cycles
Another method you can utilise to preemptively avoid payment issues would be to send the bill over at the middle of the month, instead of at the end.
This would make it easier for customers to pay your bills since there wouldn’t be any accompanying payments they would need to make, which are mostly due at month’s end. Also, instead of having to send bills repeatedly to customers who aren’t paying, you could directly contact them to find out what’s happening and what their current situation is. This would often clear out any misunderstandings right at the root, before it grows to something any bigger.
Whenever you encounter a payment which is already past due, just keep calm and try to contact the customer through several methods. You can simply just send over a reminder, or give a quick phone call to let the customer know that you are aware of the bill that hasn’t been paid yet. A timely follow-up call a few days after would also be likely for issues such as lost invoices, or receipts which haven’t been sent over yet.
When Things Get Serious
There are those times where you would have tried all you could to contact and follow-up on a customer who keeps on missing payments to no avail. During such dire circumstances, the only thing left to do would actually be to seek assistance from JMA Credit Control. We would exhaust all possible methods and sources to retrieve the amount due legally to you. We take pride in being a professional company, with many years of experience under our belt.
Debt retrieval is never a walk in the park but there is no need to worry when you have JMA Credit Control by your side.