3 Simple Rules for Collecting Debt

As a business owner, you already have a lot on your plate. The last thing you want to do is chase down delinquent customers and demand they cough up the money. You’re busy enough as it is.

As unappealing as this task may be, it’s essential for your cashflow. It ensures your rightful payment goes where it needs to go.

While there may be no foolproof way to collect overdue payments, consider this list your three commandments for the deed. They’ll help you successfully get the money you’re due.

1. Know the Laws

Strict laws regulate how you’re allowed to handle collections, and these laws are changing rapidly to counter the current economic situation. State and federal governments are adjusting credit laws to help Americans currently feeling the squeeze during these unprecedented times.

That’s not to say collections have stopped, but these uncertain times have complicated the task ahead of you.

If you aren’t completely sure of your rights, contact a commercial collection agency for information. Collection agencies stay up to date on all the rules and regulations to ensure bad check recovery services operate in ethical and compassionate ways.

2. Act Quickly

Calling a customer to pay a delinquent bill may be unpleasant, but don’t put this task on the backburner. Delaying this conversation may impact your ability to collect what they owe you.

Generally speaking, debt has a statute of limitations, meaning you have a specific timeframe to handle recouping an unpaid bill. How long you have depends on the type of debt it is as well as your location.

Once you surpass this limit, debt collection becomes more complicated. It may still be possible, but why pile extra work onto your plate when you don’t have to? Contact your customers right away to ensure they pay you in a timely manner.

3. Remain Level-Headed

Depending on your business, you may be running on very small margins. If so, a single overdue bill may compromise your bottom line. A delinquent customer’s impact on the books may feel personal, but don’t let your emotions get the better of you. It’s still business, and you need to be professional at every step.

Calling up your overdue customer to scream about how irresponsible they are is a bad idea, no matter how satisfying it may be to get these feelings off your chest. Not only will these aggressive tactics likely ruin any chance of seeing your money, but they will likely also destroy any relationship you have with your customer. You can kiss their future business goodbye.

Stay calm and be prepared. Make sure you have all the details about their account when you’re ready to make the call and keep a notebook handy so you may jot down highlights of the conversation.

Most importantly, stay positive. This may be a simple mix-up, not a delinquency, or this particular storm may havehit your customer harder than others. Keep an open mind and remember the old adage: you’ll attract more flies with honey than vinegar.

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