THE SECRET SAUCE TO ACCOUNTS RECEIVABLE COLLECTION (THAT YOUR COMPETITORS AREN’T DOING)

THE SECRET SAUCE TO ACCOUNTS RECEIVABLE COLLECTION (THAT YOUR COMPETITORS AREN’T DOING)

While there are many debt collection techniques that you can employ from the comfort of your own office; such as sending a timely collection letter, implementing collection software to eliminate inefficiencies, and more. But have you ever thought about leaving the office to visit a customer? This is something that not every Credit Manager does, but for larger or riskier accounts, it’s proven to be an effective way to build relationships that help you get paid on time, reduce write-offs, and improve cash flow.

Credit Today recently ran a survey of which explored the topic of traveling for Credit Professionals, while many reported that it was tough to get approval for such trips, those who do travel to meet with customers have seen great success. Here are a few of the repsonses that illustrate the benefit of this practice:

“By visiting our riskier accounts I can see what I can’t get out of reading credit reports and reference responses. Building relationships with accounts that maybe other suppliers won’t take a chance on. By meeting owners, CEOs or Controllers, basically upper management, I can call when we are not getting paid and they remember our meetings… The proof is in the numbers, minimal bad debt write-offs since I have actively been traveling with Sales.” – Credit Manager

“Travel is a necessity if you truly want to know your customer. Visits result in a customer paying us quicker, less write-offs and better insight(s) into the sector you serve/work-in.”- Risk and Corporate Credit Manager

According to the Credit Today survey results, there are typically three types of customer visits:

INTRODUCTIONS

This is exactly as it sounds, a trip to meet the customers who you will be/have been working with. Sometimes putting a name to a face and having time to get to know each other in person can help

INCREASED CREDIT

When a customer requests an increase to their credit limit or if a sales person feels as though a certain customer is eligible for an increase, it can be helpful for a Credit Manager to visit to better understand the financial and operational health of the company to ensure an increase in credit will not be an increase in bad risk.

PROBLEM CUSTOMERS

If you’re having a hard time getting in touch with a customer or if there are significant disputes or other problems, a face-to-face meeting can help you get to the root of the issue and come up with a plan that works best for both parties.

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