If a company is paying slowly, it may be time to use aggressive collection efforts, particularly if they owe a large amount. By aggressive, I do not mean threatening them or cutting off their credit. I am instead suggesting that you get in touch by phone, as soon as they are 30 days past due and nicely ask when you will get paid.
Doing this has several benefits:
- Collection letters or emails reminding the customer they are past due are easy to ignore, although I still suggest using them with your calls.
- Personal contact creates personal relationships. Most people find it hard to not pay people they know.
- Talking to the right person may speed up payment on the account.
- Effective calls cut down on collection time.
If the customer promises to pay but doesn’t, then you know the debtor is either in trouble or is defrauding you. In either case, it is time to limit the amount of money they owe you. Do not sell them any more goods on credit until the company pays what it already owes.
If a customer is a habitual late payer, it may be wise to place them on permanent C.O.D.
Some customers you simply cannot afford to have as customers.