Be proactive now than reactive later!
The secret to being successful is often good preparation. Most businesses pivot their collections activities around the due date and start only after the due date has passed. More often than not, this reactive approach is what might be leading to ineffective collections.
Some people might think that calling a debtor and asking to clear their dues could be a straight-forward job. However, to get your customers to pay, you need to be well prepared and arm yourself with facts. When it comes to getting your customers to pay the amount that is owed, having the facts and important information at hand is essential to keep the conversation in your favor.
For starters, set up a goal for your first call and do your research on what’s important and what’s not. Prioritize your requirements, and at minimum, be sure to keep the following supporting documents at your fingertips before the call:
Act like a human journal!
Taking notes is a critical part of effective debt collection. You must keep a record of every important detail from your conversation with the client. Documenting key aspects, including your customer’s feedback, could help you in resolving disputes faster in case there are any. The details that you could pen down while having a conversation with your client could include –
Another good reason to keep a detailed note of previous collaboration is to allow another collector to follow up with delinquent accounts in the absence of the original collector. Without easily-accessible notes, the new collector might have a hard time making any progress on the account. Taking notes and digitally keeping track of them is a proactive approach that could help ensure faster access to accurate and relevant information.
Money is the goal, but Empathy is the way!
Empathy, from being a buzzword, has come a long way to becoming an essential quality that every collector needs. What’s important to remember is, even if your customers fall behind on payments, they still matter! But how to maintain goodwill between you and your customer? A pinch of kindness is all it takes. Exhibiting empathy during collection calls could go a long way in maintaining a healthy relationship with the customer while improving accounts receivables. You could exhibit empathy in three key ways:
As a collector, showing empathy could create an environment of trust and respect for your customers. And, when there is compassion involved, your conversations get a lot easier ensuring customer satisfaction.
Unlike Kangaroos, who jump to get around, humans often jump to conclusions!
Arriving at conclusions is easier to do than discovering and tackling the actual issues. When it comes to a collector’s job, patience is an important virtue to have. Understanding your customer and helping them work through the reasons for late payments can prove to be far more helpful than displaying a bashing attitude towards them. Here are some tips to help you:
Analyzing customer issues in-depth provides a better view of the bottlenecks faced by the debtor and could be used to give out better assistance in clearing payments.
Build a defense for the defensive!
As it is rightly said, “Expect the unexpected!”. Not all customers are easy to deal with, and many tend to get defensive when confronted with facts or faults. Keeping a few methods to tackle such customers always comes in handy while facing a situation with a difficult client. Here are some pointers to remember:
It is better to know what must be said in the right fashion beforehand than to have yourself misunderstood. Misunderstandings might cost you a customer and ultimately result in loss of revenue.
Set the tone, right!
At times a lot of communication parameters don’t depend on what is said, rather on the way it is said. Applying the right tone of voice based on the type of account, customer profile, and use-case could go a long way in improving customer experience. Being assertive but not being rude is the way to go for an ideal collector. Here are a few things to keep in mind:
Don’t leave things on a cliffhanger!
For a productive collections call, there must be some well-defined action items jotted down with you at the end of the discussion. After all, what are efforts without results?
Aim for constructive results in a client call. You must actively seek out information regarding the following:
It is essential to have all important information collected and confusions sorted during the call instead of trying to reconnect later with your client and starting from square one.
Be a professional stalker, follow-up!
When it comes to collections, consistency is the key that locks a payment eventually. Any job left incomplete does not bring any outcomes. Similarly, a client call is incomplete without proper follow-ups. Here is why it could drive your client to pay you sooner:
If you follow up well, timely payments are likely to follow.
Even after focusing all your efforts in the right direction, you might not get what you anticipated. Clients can be tricky, but collections is a gritty job. If a client is unable to pay at the moment, it is a wise decision to be empathetic towards them, but at the same time, devise payment plans that could suit your client’s financial situation. Using the right negotiation tactics and securing the minimum amount of payment possible to be made at the earliest could help avoid bad debts. Upgrading skills and learning the art of negotiating with a client could go a long way in the collector’s journey. Adopting the right approach and techniques helps the destination of timely payments to arrive sooner and contributes to escalating business growth.
HighRadius RadiusOne AR Suite provides the complete collections solution to streamline labor-intensive processes by automating correspondence and providing a native dialer while delivering a personalized CX. It is quick to deploy and ready to integrate with ERPs like Oracle NetSuite, Sage Intacct, MS Dynamics, and scales to meet the needs of your order-to-cash process.
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