3 Sure Ways to Supercharge Your Debt Recovery
You’ve probably heard that “time is the enemy” in debt collection.
And procrastination is the number one factor in bad debt write-offs.
Yet still, you hesitate to send overdue files to collections. It’s a commonplace mix of overconfidence, optimism and fear of giving up more than you need to.
I’ve spent my career in Accounts Receivable Management, and I know the statistics. Every day you wait makes an overdue account less likely to be recovered.
That’s why so much of MetCredit’s focus has been on collecting accounts more quickly than anyone else. When we receive a file and get the green light to collect, our goal is to receive payment in two business days or less.
For your business, you can apply some of the same techniques to speed up cash flow and minimize bad debt.
- Button up your files. When MetCredit collection agents makes a call, they’re sure to have all necessary information at the ready, so that if a question or stall tactic comes up we have the answers. The customer requests an invoice re-sent? We fire it right off, and follow up immediately. Be sure to keep contracts, records of communication, proof of delivery and all your documentation together. You’ll collect faster on your own files, and when you use our automated system (available to MetCredit clients 24/7), it will be quick and super-easy.
- Call at the right time. Reach out to your customers when you know it’s a good time for them to pay. Early in the day tends to be better than late on a Friday when they’re feeling they’ve bought themselves another week. At MetCredit our applied AI systems use machine learning with deep industry databases and continuously adapting algorithms to tell our agents the best possible times to place a call in order to collect from each debtor, minimizing frustration at both ends and speeding recovery. While you may not have sophisticated AI tech, you do have common sense. Plan your call times in advance.
- Don’t accept delays. When a debtor business is in trouble, an automatic prioritization process comes into play, and the most critical debts get paid first to ensure continuity and avoid a forced shutdown. For you, that is probably bad news unless you are a secured creditor or provide the customer a mission-critical service. It means you will continue to be put off until things turn around—and will lose the money owed to you if they don’t. As a collection agency, we don’t accept excuses or stall tactics. The first time an already late payment is delayed, send us the file.
Getting paid quickly is NOT a luxury. It is essential to running a successful business and is central to achieving reliable cash flow.
And it’s a mistake to feel guilty about taking measures to collect any payment that is not provided as promised by a customer.
When you stop worrying about overdue accounts, you’ll suddenly feel liberated, with more time and energy to innovate, delight customers and create new revenue streams.
Got Questions? Reach out any time—and be sure to download my 10 Debt Recovery Tips to collect like a pro every time!
Author: Brian Summerfelt
President and CEO of MetCredit,
Canada’s top-performing consumer and commercial collection agency