Lesson 1: Use Positive Reinforcement
At the end of the day, it’s not just how much they order from you but also how they pay.
Lesson 2: Keep it Simple
In business, that means doing everything you can to format invoices exactly the way your customers want it, making sure to include any additional information they need on the invoice, and sending it to the right person (or department) every single time. In addition, an invoice pre-coded with the customer’s GL account number can go a long way in getting it processed and paid faster.
In short, remove unnecessary hassles and make it really easy to pay your invoice.
Lesson 3: Don’t Let Them Say “I Forgot”
So when it comes to your customers, being proactive and sending payment reminders before the bill is due should be a part of your everyday process – so the invoice is much harder to forget.
Keeping track of the responses you get is important too because it can help you to spot trends or recurring issues that need to be addressed. For example if a customer is often saying they forgot because the invoice was never entered into their payables, you may be sending it to the wrong person or there could be some other hitch in the process that needs to be addressed.
Lesson 4: Offer Help Before They Give Up
When you hear it from a customer, it can mean that they’re potentially headed for bankruptcy and at that point, there won’t be much you can do to collect your money. The best way to avoid letting things get to that stage is to continuously monitor and track your customers’ ability to pay their bills, keeping a keen eye on warning signs.
Changes in their routine such as a growing balance or a sudden switch in payment methods – paying with a credit card after years of paying by check, for example – are things to keep track of. If you see a customer drifting into trouble, find ways to make it easier for them to live up to their commitments.
Lesson 5: Deal with Defiance Head-on
Sometimes when your customer says (in effect) ‘I don’t wanna pay’, there’s an underlying message that they’re unhappy – perhaps because of a customer service issue. Dealing with it head-on, finding out what’s bothering them, and working to resolve their dispute will go a long way in getting your invoice paid.
Lastly when kids say ‘you can’t make me do it’, you may have to take away a privilege like TV time or desert after dinner. When your customers act up, immediate and corrective action like suspending their account, shutting off services, and other disciplinary steps may be required.
Accounts Receivable Software for Grown-Ups
Integrated with Sage 100
Collect-IT provides the tools you need to create an automated and consistent accounts receivable approach that will have your customers paying on-time, every time. Collect-IT works as both a stand-alone application or as an integrated part or your core accounting system by pulling data directly from the accounts receivable module and customer contacts already stored in Sage 100.
By pairing Collect-IT technology with a few life lessons, you can gain unprecedented control over your entire A/R and collections process.
Guest Post by Dynavistics, Inc.
This article was provided by Dynavistics, Inc.
The company's innovative add-on software solutions - like Collect-IT - will transform your “I wish I could” into “I know we can” by enhancing your existing ERP software so it's capable of doing more than you ever thought possible.
Their solutions for wholesale distribution, A/R collections, delivery management, and more integrate with popular ERP applications including Sage and Microsoft Dynamics.
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