Do you have a lot of customers in collections still – even though it’s already winter?
Is it time to send them to a collection company?
Could you get more money by just waiting for longer?
What are the signs that show you that your customer isn’t going to pay?
Let’s run through some of the more obvious warning signs of a customer that’s about to become a late or nonpaying customer.
First, we know that if a customer has a history of paying late or not paying at all, that’s a pretty good indicator that you’ll see future delinquencies.
In some cases, we see consumers dissatisfied with the product or services immediately which can be a red flag for a delinquency issue. It’s essential to take care of those matters right away. That way, you’ll know you’ve done your part.
Another one is the old Check is in the mail promise.
And we know sometimes how that ends, the check isn’t in the mail. Or, sometimes the check does come, and then it bounces.
Other signs you’ll have trouble getting paid
The ignoring of phone calls and written communication in the form of statements or demand letters are indicators. In extreme cases, disconnected phones and returned mail tell the story.
In short, empty promises or lack of communication, in general, is a sign that you’ll have to get a little more assertive in getting that customer to pay.
We’ve preached this for years and it’s always good to repeat; the longer an account goes unpaid, the more difficult it is to collect on. So what can you do?
Act quickly on overdue accounts. When you see any of the warning signs, we just went over, keep a close eye on that account and follow up to try and resolve that issue. If you still have not communicated with the customer or received payment, it’s time to get help.
Get a reputable collection agency working for you by the 60-day mark. Don’t wait any longer because the likelihood of you getting paid goes down with the age of the account.