Did you ever wonder why your customers are not paying you on time? It’s one of the more frustrating aspects of running any size business. Customers contact your business, you provide the service that you promised and then in some cases, you’re left to chase that customer for the money they owe you.

And because you have other customers to serve, and a whole host of other obligations to run your business adequately, you and your staff now must expend time and other resources to get that customer to pay.

Your accounts receivable process is just part of running a business of any size. Customers are going to pay on time, some are going to pay late, and a handful are not going to pay you at all. Every business needs to deal with this, but we are always asking in the back of our heads why certain customers don’t pay.

As a collection agency serving all types of industries as well as large and small businesses, we have found that these are the most common reasons your business is not getting paid on time.

Your customers forgot to pay you

Yes, customers forget to pay businesses all the time. And many people are disorganized, having an endless pile of envelopes in some part of the home. They procrastinate, tell themselves they are going to sit down and pay their bills, but for some people, it just piles up month after month. Not everyone goes through their mail on a regular basis. Go to any household in the United States and you’ll see a pile of mail just waiting to be opened. Many families also think that the spouse paid the bill and end up ignoring it. So yes, in many cases your customer didn’t pay you because it was an oversight.5 reasons your customers are not paying you on time

There is a dispute regarding the service you provided your customer

Many consumers hold back payment because they were either displeased with the service or there is a dispute with the business they used. Some consumers fail to address the matter in a timely manner and the way they decide to resolve it is to not pay the business that served them. But we are well aware that tactic doesn’t work. That’s why it’s important to maintain consistent contact with your customers and if you sense there is a problem with what the customer received from your business, it’s important to open the lines of communication and resolve that issue. The customer may have had different expectations for what you were supposed to provide them, or they didn’t fully understand the service you are obligated to provide.

Your customer is having financial challenges

One of the main reasons consumers hesitate to pay a business is because they are having financial challenges. In short, they just don’t have the money to pay you. This can happen for a number of reasons. First, the consumer just overextended themselves but went ahead and asked you to provide a product or service. Or in many cases, it was an emergency such as a plumbing or heating repair job, or a veterinarian bill. It was important for the consumer to get their issue resolved but at the same time, they didn’t have the resources to pay your business.

Your business delayed invoicing customers

We handle a lot of debt collections for small business and time after time we see many businesses that have let their invoicing pile up. The business is either short-staffed, or they don’t have the accounts receivable systems in place that would eliminate this problem. We also see this often when it comes to seasonal businesses that we serve. When it comes to our landscaping and lawn care debt collections, many of the people that contact us haven’t invoiced in months because everyone on staff is out serving customers. That’s why no matter how busy your business gets, it’s critical that you have a regular schedule of invoicing. Sending a bill three months after service could result in a dispute with your customer.

Your business is too easygoing with payment policies

If you let clients pay you late time after time, guess what? You’ve now trained them on how and when to pay your business. You do not have to rain with an iron fist when it comes to getting your customers to pay. But you should make sure that they understand your expectations and your payment policies. And even more important, you need to stick to those payment policies.

Customers also need to understand that your business will only deal with nonpayment to a certain point before implementing your debt collection agency.

If your business has an ongoing need for debt collections, give our team a call today for a free consultation!

Published On: March 4th, 2022Categories: Accounts Receivables, Advice for Businesses, Small Business Collections

Need to discuss your debt collection needs with APR?  Call (800) 711-0023 or use the form below to request more information.

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