It’s a fact that no business owner enjoys making debt collection calls. From a business owner’s point of view, a collection call is ‘just one more thing’ on a long list of many things they must complete, and worse yet it doesn’t make a new sale.
From an emotional perspective, no one want’s to feel like the bad guy when they call their customer. No business owner wants to feel like a mobster or loan shark threatening to, metaphorically, break someone’s legs if they don’t pay. The truth is most business owners would much rather be making a sales call or closing a deal.
That said, whether it’s a sales call or a debt collection call, get the most out of each call. It also makes sense that we keep accurate records and up-to-date contact information on customers. Without the right phone number or contact information, it can become exceedingly frustrating to get in contact with the people that owe you money.
The good news is that just like sales call skills, making collection calls is a skill you can actively develop. You can be ready for what a customer might ask and what they may say to you during the collections call. Similarly to the sales call where you have a value proposition and then a closing, a collection call reminds the customer of the value proposition they already took advantage of and what you both agreed upon during the closing.
Also, just like when making a sales call, professionalism is critical for your collection call to be successful. And a successful collection call must always close with an agreement as to what the payment arrangement is. Remember, the goal is to get paid.
A few pointers that will help you sharpen your collection call skills, as well as help you get calls done quickly and efficiently are:
- Keep your contacts and account information on hand, and update that information regularly.
- Schedule specific times to make collection phone calls. Be habitual and give yourself time to focus on the goal.
- Always leave messages for people to call you back, but do not reveal that the call is about an unpaid bill.
- Engage your customer; ask your customer to acknowledge the debt by asking if there was a question about the bill or the charges. Verbally lead them to a mutual understanding that they owe you money.
- If your company can, offer to take a credit card over the phone for payment. If they hesitate, offer to waive part of the late fee or even waive all fees.
- If the customer doesn’t want to use a credit card, provide money wiring instructions or some other option for immediate payment. Tell them if they make payment today, you could waive some or all of the late charges.
- If they refuse to pay now, ask “when will they pay?” – And then wait for their answer. Make a note and follow up on this agreement.
- Let the customer know that you are documenting their account in regards to your agreement, and reiterate their commitment to making payment. Let them know that you will be sending an email or letter reflecting what the agreement is.
- Make sure you send the letter or email to the customer that documents your payment agreement with them.
Additionally when you are making collection calls, feel free to ask questions that require specific answers. Speak with exactness and lead the conversation from questions to closing, which is the moment you can both agree on a payment arrangement. Always wait for the customer to answer each question, and if they are not specific enough, ask for clarity.
Customer: I don’t have the money right now to pay you.
You: When will you have the money?
Customer: In two weeks when our next contract is paid.
You: What specific day do you expect your contract to be paid?
Customer: Most likely October 16th.
You: Ok, so on October 17th you will wire the total amount of $2,500 plus the late fee of $35 owed?
Customer: Yes, I will agree to that arrangement.
The above example is, of course, a simplified scenario for a collections call since the customer can respond in many different ways. But it’s important that you remain positive and confident. You want to compel the customer to agree on a payment amount and a specific payment date. Again, once you have an agreement, send a confirmation email or a letter with payment instructions. As the payment day approaches, follow up with the customer to remind them of your agreement and to ask if their situation has changed. Keep in mind that when people are cash strapped, they tend to pay themselves first and then put money into the hands that are open in front of them. You want to be the first one in line to be paid.
We hope that you find these collection call tips valuable and educational. And when you have debt collection issues and need someone on your side, or maybe you want a better understanding of how you can recover bad debts, know that Burt and Associates is your go-to expert. Please feel free to contact us today through our website, email, or by phone. Our representatives are available to help you today.