Financial expert Kym Nitschke takes on the delicate topic of how to call in your debtors who owe your business money.
Keeping your cash flow balanced is hard enough for your business. Add in an ever-growing pile of bills and a horde of slow-paying debtors, and you’ve suddenly got sheer chaos on your hands.
The best way to get ahead on these matters is by getting on the phone and directly contacting those late paying debtors.
Make these calls are tough for all involved! However, phone calls are effective because they will get you an immediate response. But their intrusive nature makes the task an uncomfortable one.
Here are some tips for minimising the awkwardness of the situation.
If you don’t have your facts collected and organised, you’ll only fumble your way through the phone call, which won’t garner you any respect. Before making the call, be sure you have all the correct facts on:
– The person’s name
– Current phone number
– Outstanding amount owed
– Reason for the debt
– Date of last payment
– Record of previous attempts to collect the debt
Be prepared – don’t go into your next call blind!
Making the Call
Identify yourself right away and then establish whether you are speaking with the right person. If no one answers, leave a polite message. Don’t disclose in the message that the call is in relation to an unpaid debt.
Even if the recipient of your call tries to argue, don’t get sucked into the same behaviour. Remain calm and professional at all times. Stand your ground keeping in mind that you have a responsibility towards your company. Do not get emotionally involved.
Getting the Debt Paid
Once you both agree on the balance overdue, ask for payment in full. This is the best option for getting payment quickly, such as by credit card. If the payment isn’t going to happen as soon as you would like, try to settle for a written agreement (letter or email) stating the amount due and when it will be paid.
Be Prepared to Negotiate
The invoice might have gone unpaid simply because the customer couldn’t afford it in full at the time. Consider coming up with a flexible payment plan. Getting back what you’re owed all at once is safest, but not always ideal. Be prepared to negotiate to find an arrangement both parties are happy with. It’s better to arrange for a partial payment over time than to be left burdened with the debt, yourself.
Squaring up with debtors is often an uncomfortable ordeal. If you need some extra help and advice, give Nitschke Nancarrow a call on (08) 8379 9950 or simply send me an email.
– Kym Nitschke
Tags: Adelaide, debt repayment, debtors, settle debt, South Australia