When initially contacting a business or customer about an unpaid invoice, it's important to check that the invoice was in fact issued in the first place. Although this sort of administrative error can easily occur in the day-to-day operations of a business, it's a quick-fire way to earn your business an undeserved reputation of incompetence or bullishness.
Once this has been verified, it's best to initially contact the debtor on cordial, polite terms. Be sure to provide clarity around the details of the debt. Quoting an invoice number, amount due, date issued and date due may be helpful to the debtor. In many instances, debtors will simply have forgotten payment, and will be eager to oblige when reminded.
When dealing with some many debtors, recovering payment may require a little more strategy or negotiation. It's crucial to remember to remain friendly, polite and flexible. A "problem solving" mindset can achieve far greater results for your business than a demanding one; debtors with restricted cash flow may be receptive to suggestions of payment plans.
The key aspect for such instances is to receive definitive answers to questions raised by the debt - find out why the debtor is yet to pay, and see if steps can be taken to accommodate these circumstances. If a debtor flatly states they are currently not in a position to pay, arrange a future date to contact the debtor to arrange payment terms.
Some debtors are especially troublesome, noncompliant, or even hostile - in such instances, it's prudent to escalate proceedings. Firstly, inform the debtor in a cordial manner that if payment is not received, more serious action may be taken against the debt. If the debtor is still not cooperative, it's time to engage with a debt collection expert, like Ezi Debt Collection.
With a no-collect, no-fee policy, and collection fees of just 10% of the repaid amount, Ezi Debt Collection is a great way of keeping your cash flow intact without major losses to your businesses' bottom line.
EDC is an authorised debt collection tool and we work entirely within the parameters of Australian Consumer Law.
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