Collecting debts from a fellow business while maintaining your business relationship with the company is a tricky operation. It requires finesse and acting with consideration and patience for the debtor. However, you cannot be too timid as delays are disastrous in debt collection. Here are some tips for successfully obtaining payment and not ruining your existing relationship. Following them will help keep your professional reputation intact.
Polite and Prompt Communication
It is important to professionally communicate with the company and make sure that they are aware of the debt. While this is awkward and difficult for most people it is a critical step. Do not delay as the longer you wait, the less likely it is that you will be able to collect a significant amount. When the business is inefficient and overwhelmed they may be putting their bills on the back burner. It is likely that they are setting them aside and paying only when they are contacted. The collectors who contact them respectfully are generally the ones that get paid.
Get Yourself Organized
To successfully deal with the inefficiently operated business, you need to get your business organized first. You need to know the full situation of what is owed, how past due it is (hopefully, not very), and any other important details. Debt collection software is very helpful in putting together this information so that you are prepared to make contact and request payment. Businesses that are having trouble getting their act together need you to show them these details so that they don’t have to try to figure it out themselves. Make it easy for them to get their account in line and they will actually get some relief. It feels good to have at least one account resolved.
Document and Follow-Up
Another key is to provide the debtor with documentation of the debt and status in an easy to understand format. If you clearly show the debt, you increase the likelihood of receiving payment. If the company can’t decipher the debt status (payment history, interest, etc.), they are more prone to setting it aside to review at a later date rather than making a payment. And following up promptly is also key as the inefficient business may still misplace or space out your invoice.