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Don't assume that accounts know your credit policy - If payment is overdue,
this can be the first step in facilitating payment.
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Know your customers individually - Once a customer's records begin to show
irregular payments, it is advisable to keep that account under close scrutiny.
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Keep your records current - Changes in the market as well as management direction
can abruptly alter the course of a company's financial health and conduct. Try to
keep abreast of the trade reports pertaining to specific companies so that you're
always aware when changes occur.
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Tighten your collection procedures - When business conditions are uncertain,
start by revising your collection letters, making them stronger and more action-compelling.
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Try to discourage extended payment terms - Screen requests for extended payment
terms carefully and ask your sales department to discourage these requests, so that
they can be held to a reasonable minimum.
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Pursue partial payments with requests for the balance - The best practice
is to acknowledge partial payments promptly and then follow-up with communication
to accelerate payment of the remainder.
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Shorten your collection schedule - Cut the time lag after an account's due
date by shortening the period from that date for continued extension of credit privileges.
This practice can sometimes exert needed leverage on accounts, particularly those
that rely heavily on the supplies or services your company provides.
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Keep your lines of communication open - But make sure you're getting through
to the right person - the decision maker.
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Try to resolve disputed matters quickly - Insist that the undisputed portion
be paid immediately, indicating that the balance will be negotiated.
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What to do when all else fails - Your judgement will tell you when you have
exhausted all the means at your disposal to negotiate a satisfactory payment, while
maintaining the account as a customer. At this point you can take positive action
by referring the account to a professional Account Receivable Management company,
who is a Commercial Collection Agency Section member holding the prestigious certificate
of compliance such as DAL National Clearing House.
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