Commercial Collections Blog

Are You Reaching The Right Party?

Every company that extends short term credit is going to have to collect on those accounts at some point in due time. It’s simply how business gets done regardless of what industry or niche in which you operate. When it comes to collecting on unpaid accounts or outstanding debts, you need to know that you are reaching the correct responsible party the first time and every time.  However, ensuring that you reach the right people to pay what they owe is never as simple as it sounds. One out of every five debt collectors spends more than 50% of their time manually locating individuals or correct contact information for debt collection purposes.

 

Are You Reaching The Right Party?

 

Worse still, 85% of all successful location attempts take two or more weeks to complete. Right-Party Contact information, or RPC, is vital to making certain that unpaid debts can be collected as quickly as possible.  One of the ways that most collectors find RPC quickly and inexpensively is to take advantage of online databases that contain customer contact information. Over 95% of all debt collectors agree that updated online contact databases result in the best outcomes for RPC on the first attempt when collecting a debt. In fact, 83% of debt collectors have stated that they can find that RPC information in just minutes using online consumer contact databases.

However, improving your RPC and making good on collecting outstanding debts is a simple matter of being properly prepared and following a set protocol with every new customer for contact information collection. Collecting a customer’s best contact number is only the beginning of good RPC protocol. Following up periodically to make sure that contact information is correct is also exceptionally important to the process. One of the best ways to do this is to establish an ongoing communication with every customer using their best contact information. When you maintain a rapport with your customer, they are far more likely to prioritize paying on your account. Establishing an engaged business relationship is key to ensuring that customers are as motivated as you are to make sure that outstanding bills are paid.

Make sure that your written correspondence, whether via email or standard mail, is doing everything possible to establish and maintain that rapport with the customer. Starting messages with “Dear Customer” does not inspire most people with the warm and happy emotions towards and an organization, so if possible make sure that you are using the correct contact person’s given name on all correspondence. Be concise and engaging with your message, and keep everything as positive as possible. Assume with confidence that the customer is going to pay what they owe as soon as possible, and this is just a courtesy reminder. When you assume the best in written correspondence, it sets a more positive tone to the overall relationship, and the customer feels more like a respected business partner than a debtor with an outstanding bill to pay. You also establish yourself in a position of trust with that positivity, changing your image in the customer’s mind from a creditor to a supporter.

This principle of positive contact when reaching the correct party also applies to phone calls. Phone calls can be difficult when making business to business calls, as you don’t always have a specific contact person to talk to, but just about every business has someone who oversees Accounts Payable either in-house or on retainer. Once you are connected to someone who is authorized to make commitments, it is extremely important to start taking highly detailed notes of everything that is said and agreed to during the phone call. Trusting to your memory and that the party on the other end of the line will recall what they agreed to is foolhardy at best and disastrous at worst. Write down any names that are mentioned, any payments or percentages that are agreed to, and any dates mentioned regarding the account. It is also an excellent idea to get an email address for the person you spoke with before hanging up.

Once you have completed the call, use your notes to compose a follow-up email detailing what was discussed or agreed upon during the call. A follow-up email will ensure that everyone is on the same page, and you have documented your call in writing and copied the person you spoke to with all relevant details.

Good business starts with good relationships and establishing those positive relationships early on sets the tone for how business will be conducted between service providers and clients in the future

Reaching the right party the first time is essential to making sure that bills you send out are paid promptly, but the way in which you follow up and collect is equally important. If you’re reaching the right party the first time, make sure that you are also reaching them in a positive way regarding their account. Good business starts with good relationships and establishing those positive relationships early on sets the tone for how business will be conducted between service providers and clients in the future.