The present global health crisis is causing economic uncertainty across all areas of business. Anchor Professional Services Ltd remains open for business and will continue working to secure your cash flow during these difficult times.
COVID-19 will inevitably have an impact on the debt recovery processes across all sectors. However, businesses can do a number of things to ensure invoices are paid, recover outstanding debts and reduce the risk of cash flow shortages.
During this period of uncertainty especially if you have time on your side, credit controllers can review the business’ ledger and improve the recovery prospects.
6 Top Tips If your customers – especially individuals – are in financial difficulty during the current crisis.
It’s never going to be easy to ask your customers for payment during these difficult times. However, we hope you will find our top six tips helpful in giving you some ideas how to approach this very sensitive issue.
Listen to your customers to find out how they are positioned:
- Ask them how they are coping with the situation.
- Ask if they are having problems in making payment.
- If they are, ask them if they have taken advantage of the government schemes to assist during the pandemic.
The phone will work better than email, simply because it is more personal – you can empathise over the phone and get more information than you will by email. The most important point to remember is to be “soft on the people but harder on the problem”.
Ask them what time suits them best for a phone call. Don’t be tempted to send loads of emails saying, for example, that you need to speak to them urgently. It will be better to say in an email that, in view of the current challenging times you would like to have a quick catch-up to review where you are both placed.
You may wish to mention to them that you are reviewing your current collection cycle. Explain to them that your systems automatically generate a series of letters requiring payment and, as each letter is sent, the letters become more “severe”. Explain that, in view of the current understandable difficulties, you would prefer to discuss matters with them rather than simply sending them demand letters. If you are unable to “switch off” your software and the chaser letters are still being sent out, explain why this is happening – perhaps apologise, and say you would prefer to have a discussion with them.
- Tip 4
- Try to explain that you want to explore how payment can be made in a collaborative way and that you are seeking a “win/win” solution.
- Are you prepared to accept instalments or deferred payment? If you are, then be sure to establish a definitive date when you will receive your cash.
If your customer refuses to engage, then it may be at this stage that you will want to refer this to a third party such as Anchor Professional Services Ltd.
- Tell them that you want to be fair with them and explore all options.
- Emphasise that, if they do not engage, then you will have no alternative other than passing this to a third party to pursue.
- Keeping with the “empathic theme”, say that you will be reluctant to do this and say to them that you will not pass this on if they make contact with you within 3 days. Actually state the date you want them to contact you by as this will have greater impact.
If, despite all of your efforts, your customer will simply not engage with you then:
- This may be the time to refer this to us. We will have various options for you. We can send our standard pre- court action letter or we could tailor this for you – perhaps continuing the empathic theme.
- We can say we are aware that they may be having difficulty in making payment due to the current crisis and that what you want to do is engage with them to establish their current position.
- You may want us to say that you are willing to enter into discussions about an instalment plan or deferred payments. You may want us to add, however, that if they do not respond to us by a definitive date then your instructions will be to institute legal recovery proceedings but you hope that will be unnecessary.
- We can highlight that we can apply a late payment charge under the Late Payments Act and interest for each day the debt remains outstanding.
Why not contact Janet Ebanks or Ivor Patterson if you want to discuss any of your debt recovery or cash flow options.
The present global health crisis is causing economic uncertainty across all areas of business. Anchor Professional Services Ltd remains open for business and will continue working to secure your cash flow during these difficult times.
COVID-19 will inevitably have an impact on the debt recovery processes across all sectors. However, businesses can do a number of things to ensure invoices are paid, recover outstanding debts and reduce the risk of cash flow shortages.
During this period of uncertainty especially if you have time on your side, credit controllers can review the business’ ledger and improve the recovery prospects.
6 Top Tips If your customers – especially individuals – are in financial difficulty during the current crisis.
It’s never going to be easy to ask your customers for payment during these difficult times. However, we hope you will find our top six tips helpful in giving you some ideas how to approach this very sensitive issue.
Listen to your customers to find out how they are positioned:
The phone will work better than email, simply because it is more personal – you can empathise over the phone and get more information than you will by email. The most important point to remember is to be “soft on the people but harder on the problem”.
Ask them what time suits them best for a phone call. Don’t be tempted to send loads of emails saying, for example, that you need to speak to them urgently. It will be better to say in an email that, in view of the current challenging times you would like to have a quick catch-up to review where you are both placed.
You may wish to mention to them that you are reviewing your current collection cycle. Explain to them that your systems automatically generate a series of letters requiring payment and, as each letter is sent, the letters become more “severe”. Explain that, in view of the current understandable difficulties, you would prefer to discuss matters with them rather than simply sending them demand letters. If you are unable to “switch off” your software and the chaser letters are still being sent out, explain why this is happening – perhaps apologise, and say you would prefer to have a discussion with them.
If your customer refuses to engage, then it may be at this stage that you will want to refer this to a third party such as Anchor Professional Services Ltd.
If, despite all of your efforts, your customer will simply not engage with you then:
Why not contact Janet Ebanks or Ivor Patterson if you want to discuss any of your debt recovery or cash flow options.