The title may grab you but let’s be clear, debt collections is not sales and it is not selling anything. However, some of the core strategies that allow a sales executive to be successful can be viewed as some of the same traits you should be implementing in your collections. Let us explain.
There are always great lessons to be had and new things to be learned if you’re looking in the right places in the world of business. A successful sales professional has many elements that allow that person to achieve their goals. And while we have all run into “that” sales guy who may have turned us off, the good ones follow some basic philosophies.
Taking a page from the sales book can help you improve your internal accounts receivables program.
Always be honest
Great salespeople are honest with consumers and if you are trying to collect overdue payments from your customers, you should be honest as well. Never tell them anything that is not true about the money they owe you and do not add interest to the invoice unless clearly stated in the original agreement. If work was to be performed and somehow it was not, own up to it before seeking payment again.
Improve your people skills
If you want to get your customers to pay, you’re going to have to make a connection with them. Having employees call your customers for late payments that clearly do not want to be making that call is a mistake. Reaching out to your customers with a warm and cordial voice is one of the best ways to start a dialogue and get them back on track with you. If you don’t feel you can do this and you do not have anyone on your team that can speak with your customers pleasantly, consider hiring a reputable collection agency that can take that over for you.
Solve the customer’s problem
A great sales professional knows how to understand a customer’s problem and how to solve it. If a customer has not paid you, there is an issue that needs to be overcome and you need to do your best to provide that solution. Just like a professional salesperson, if a customer needs more time or they need a payment plan, try and solve their problem that way. However, you will not understand their issue until you ask them.
Implement a repeatable process
A business that stays on top of its receivables can only improve cash flow. Staying on top requires your organization to invoice regularly and stick to a schedule of billing for services. People who are good at sales understand the process of cultivating and selling and they repeat that process to be effective. Making sales call is in their calendar and invoicing should be in yours.
Always follow up
If you are good at sales then you know the art of follow-up. And collecting overdue payments is no different. We talk to businesses every day that have not followed this basic principle of collections. Sometimes, unpaid bills are an oversight, and a brief follow-up is all it takes to get paid. But if you are not getting paid from your customers, you can become less frustrated by creating a routine of following up with your customers.
Get good at listening
You cannot help a customer unless you listen, it’s that simple. Whether they are looking to buy something or are behind on a payment, you as the business need to understand the art of listening. You cannot sell someone the correct product without understanding their need. You will never solve a consumer’s debt problem by demanding payment without understanding the situation. Our collectors do this every day. They first listen and then offer a solution.
Know when to back off
Our professional collectors are really good at this and so is a good salesperson. There are just times when you need to back away for a period of time. For salespeople, the timing may not be right for the consumer to make a purchase. When collecting money, getting on the phone with an angry consumer will not be productive. You need to know when to back away and revisit the situation at a later date when you can have a constructive conversation.
Want to improve cash flow and good relationships with your customers? Take a page out of the sales playbook and you might be surprised at the results.