Who IS Getting Paid On Time?

This past week we've been fielding calls from the press trying to understand the significance of the latest reports from credit managers reporting slowing customer payments. Of course our response is that companies need to perform actual credit work to know which customers will pay slowly in the first place, but what to do when you've already made these decisions and now need to get paid?

Here are our recommendations:

1) Get rid of lazy, passive practices like sending form letters out (except for really small balance accounts where it costs more to call than to send out a letter).
2) Improve your collection technology so that collectors can actually spend most of their time making calls and NOT trying to figure out whom to call.
3) Create metrics to improve your calls per hour made. Unless your customer calls involve very complicated billing transactions, most collectors should be able to make 10-20 calls per hour.
4) Train your collectors on negotiations tactics. They'll be competing with all of the other collectors calling your customers, so they'd better be good. There's no such thing as a "routine call" in a tough economy. They've got to step up their game now or be left without any part of the customers' cashflow.
5) If you haven't already done so, separate the credit work from the collections work. Collection calls are best made one-right-after-the-other (just like sales calls). Stopping and starting so credit applications can be reviewed or orders released is not efficient nor effective.

Sure, some creditors are reporting slowing payments; but some companies are very successful at minimizing delinquent accounts receivable (TCD clients, for example) even in these difficult economic times.

Make changes NOW to get your company paid on time!