“The vast majority of customers have no problem paying what they owe you and doing so on time. But poor accounts receivable management can frustrate even your best customers.” | Tsico.com
Not all people are criminals trying to steal from you. They’ve got their own excuses why they haven’t paid.
It could be because everyone in the family has lost a job or some other source of income has dried up. They may have worked themselves into debt, and now they’re having a rough time getting out.
It’s better to use a strategic approach that handles them as human beings and chase them with rage. When you understand their conditions and strive to open a polite conversation you will experience collection success even more often.
There are a number of other reasons why a diplomatic approach is often safer and wiser.
Diplomacy maintains the friendship
If you criticize delinquent clients and pursue them in a combative way, the relationship will almost inevitably be soured. You may be able to recover what you owe, but you’re going to lose all future business. It might be a penny-wise, pound-foolish decision.
The situations of your client are likely to change. If they’ve lost their job, they’re going to search for a new one. They may have trouble covering bills right now, but that won’t last. If you handle them in a polite, compassionate way, and work with them to find a payment plan that works for them, they would genuinely trust you more.
Not only are you going to get what you owe but also, a promising substantial potential customer for life.
Diplomacy gets the client to respond to you
Customers do not respond to frustration or threats. If you leave a threatening message in someone’s voicemail, you will lead them to withdraw in fear and miss future messages. They know they owe you money, and they don’t know what to do in certain situations.
The inclusion of risks further compounds their issues. On the other side, leaving a calm, understanding message that underlines the willingness to interact with them to find a solution that they can afford gives them hope.
It helps them see that there is a light at the end of the tunnel. Their fear of repercussions is replaced by a hope that they can find a way out of debt. If anyone knows you’re on their side, they’re much more inclined to call you back.
Diplomacy is tougher on the collections team
The way we treat other people has an influence on how we view ourselves. Imagine that you were to spend a day at work stalking and swearing at people you knew were down to their luck. It’s going to take a toll on your mind.
A diplomatic approach to debt collection encourages the employees to hold discussions with individuals instead of intimidating them. It helps them to get to know your clients better than to treat them as criminals. Instead of feeling like they’re chasing people around, the workers will feel like they’re getting people out and that’s because it is.
Diplomatic debt collection is about helping the late-paying clients to find a solution to their situation. It’s a positive process that benefits both you and them. When the workers handle the situation in this manner, they will report higher work satisfaction and you will see less turnover.
