The Right Way to Handle Customers in Default & Collect Payment
Running a business is already tricky in itself since you have to keep the balance between generating sales, managing your operations and keeping customers happy.
A lot of experts say that customers should form the backbone of your business, which is why you need to take care of them. But then, there are customers who don’t return your kindness.
Instead of fulfilling their obligations, they go into default by missing their payments. Collection agencies accounts will confirm all of these hardships.
Although a lot of people don’t see this as harmful, having several customers go on default could hurt a business immensely. This is why a lot of businesses take the drastic and aggressive approach to collecting payments from clients who default.
They end up hiring a collections agency that makes persistent calls to customers to collect payments. But there’s actually a way to talk to them without making them feel harassed:
- Don’t go into battle without a plan. Before you even make that first contact, try to assess the situation and create a plan that will benefit both parties and regain the relationship that was lost because of this default.Never go into an aggressive and often embarrassing dialing campaign. Instead, plan on ways to reach out to your customer in a persistent but not aggressive manner.
- Be consistent. Although a few customers would appreciate you reaching out them personally and not go through a collections agency, you can expect most of them to not respond positively to you right away.But even if you’re tempted to go back to being aggressive or try to “get back” to angry customers, try to stick to your original plan for as long as you can.
- Adjust accordingly. If your first message didn’t get the right response, find ways to write a better message. It’s also very important to create a process that’s feasible for you and your team and gather data on what has worked for you and what didn’t. For instance, you can change the frequency and channel of your attempts if you’re not seeing results in your current process. You’ll need to do some trial-and-error on this, so make sure to find what works for your business.
- Don’t be afraid to consult the experts. You’ll struggle with the process at some point, especially if customers are a bit hard on you. Although they owe you money, you’ll need to extend your patience for as long as possible because you have a reputation to protect. When all else fails, don’t be afraid to ask the help of experts who can give you the right advice on your situation and help you craft a more effective plan of action.
Dealing with customers on default is a huge challenge for any business, which is why a lot of owners rely on collections agencies to deal with the problem for them.
But what not a lot of these businesses realize is that it also destroys their relationship with these customers.
So if you don’t want to go through the same aggressive approach, follow these tips in tackling customers who go on default. If you’re consistent enough, you’ll surely get better results in the long run.
As a high risk merchant account holder, it is up to you to ensure your invoices are paid.
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