The document provides practical tips for successful debt collections in businesses, emphasizing the need for preparedness, documentation, and positive communication with customers. It outlines techniques like confirming payment status, offering payment options, and maintaining open lines of communication to encourage debt resolution. Additionally, it suggests hiring a collections management professional if internal efforts fail to yield results.

1. TIPS FOR
SUCCESSFUL DEBT
COLLECTIONS!

2. Debt collections happen in almost every operating business. They are just
part of the business landscape. In today’s tough economy, customers may be
having more trouble than normal paying their debts. When
invoices/installments aren’t getting paid, it may be time to hire a Collections
Management Professional (CMP) to help get these debts paid. CMPs are
experts in the business to business debt collection. As in every industry, there
are good ways and bad ways to perform debt collections. Here are some
ways to increase your success.

3. 1.Be Prepared
Before you make the initial contact with a delinquent customer,
make sure you know everything you can about the customer.
Make copies of all invoices, contracts, and any other information
that will help you speak knowledgeably, professionally and
personally with the customer.

4. 2.Document
Everything
While talking to the customer about the outstanding debt, take
careful notes about everything that was discussed, including the
customer’s comments in case there is a future debt dispute. If
your company has tracking software, input everything into the
system while the conversation is fresh in your mind. Over time,
continue to add any additional details to your file to keep it as
up-to-date as possible.

5. 3.Don't Assume
Anything
When making your initial debt collection call, quickly make sure
that the debt has in fact not been paid. Don’t alienate the
customer. Remember there may be a potential future business
with the customer. The debt in question could be a mistake and
not a collection problem at all. Be careful with your tone and
your words at this point. Wait and listen to what the customer
has to say, and be sure to document the interaction carefully and
accurately.

6. 4.Be Pleasant and
Control Yourself
The tone you take with your voice can impact how successful the
conversation will be. If you start off the conversation with a friendly,
non-confrontational tone, the customer may respond more positively.
Once you have confirmed that you are speaking to the correct person
about the unpaid invoice, ask if you can do anything to help. Ask if they
need any additional information. If you act like you care or can
understand the debtor’s side of the story, you may be able to prevent
the person from becoming defensive. However, they remain detached
from the situation. Your job in debt collections ultimately is to collect
the debt in full as soon as possible.

7. 5.Avoid Confrontation
& Manipulation
Attempt to find out if the debtor’s excuse for not paying is
legitimate. For example, if the person blames the non-payment
on someone else, confirm this is true or false by contacting the
other person. Listen carefully to what the person is telling you,
and get a sense of whether the person is being honest with you.
Often, your gut feeling will be right on.

8. 6.Put a Stop to Anger
or Harrasment
Always try to stay calm even if the debtor becomes abusive
during the contact. If this happens, you might suggest calling
back later. No matter what, always listen carefully to what the
customer tells you and try to keep the dialogue constructive as
much as you can. It’s important to let the debtor feel he is
making progress.

9. 7.Give Options
If a customer is having trouble paying off debt, it might be
possible for him to make payments over time. Try to work out a
plan that will work for both the customer and your client. The
goal is to get the customer to pay the entire debt as quickly as
possible. Listen carefully and offer options until something
workable is defined.

10. 8.Recap the
Terms
Once a payment plan has been agreed to, verbally summarize
the plan for the debtor. This summary should include specifics of
when the debtor will send each payment, and what form of
payment will be used. Then document it in writing via email, fax
or letter. Ask the debtor to call or e-mail you once payment has
been sent.

11. 9.Keep
Communicating
Even if the debtor can’t pay right away, it is always important to
keep communications going. He may be able to pay in the future,
and by talking to the debtor and really listening to what he has
to say, you may be able to help him figure out a way to start
paying sooner. While the older a debt becomes, the harder it is to
collect, sometimes circumstances change and payment may
become possible.

12. Debt collections are common, especially in difficult economic
times. Using these collection techniques should increase your
odds of success. But, if all this effort doesn’t result in getting
paid, you may want to use the services of a CMP.
For more information on debt collection strategies, contact me
on bob@ibrahimkhattab.net

13. THANK YOU!