Negotiating Your Debts In
Every day I am hearing the same reports. “It was a nightmare! Four phone-calls a day, every day for a month; the people were so rude and aggressive.”
Just stop and think about this for a minute; five days a week, four weeks…..that’s 80 calls! At five minutes each call, that’s 7 hours of someone’s time….but that’s not all. If you have to make all those calls, you haven’t got a result - otherwise you would have stopped long ago.
It’s time to wake up. As a business model, it simply isn’t working! In what other business sector would you employ people to make 80 phone-calls for such a pitifully poor result? Just suppose you could achieve the same or better results in only four 15-minute calls. Your working time would reduce to 15% of its present level, without affecting your income.
Collecting debts is a negotiation, every bit as much as selling a business or buying a car. I have been collecting debts for many years – on my own account as well as for clients. I now have a Credit Control business and I know what works and what doesn’t.
Very few debtors have absolutely no money whatsoever. What they have is insufficient money. They have to make priority decisions regarding the disposal of that money. Your job is to move your particular debt up the priority list. Frightening the customers might seem to be a short-cut to negotiating with them, but when you examine the call-rate statistics, you can see that it is a short-cut into a cul-de-sac.
I teach my staff to think of themselves as salesmen – to use persuasive skills to get the money in. They speak to customers in a pleasant manner and convince them that they are on their side. They acknowledge and sympathize with their cash-flow problems and so build a relationship. They then use that relationship to do their job. If they can’t achieve an immediate payment in full, they will then steer them gently into an arrangement to pay in stages. If the debtors are businesses, they will ask for a series of post-dated cheques.
If there is a dispute, they will not brush it aside. They will listen carefully to the details and promise to investigate. (If the dispute is genuine, this will actually save you a lot of valuable time). If the dispute is significantly less than the overall debt, they will politely suggest that the non-disputed balance is paid immediately…..so as not to cloud the issue.
If you are still using the “rottweiler” method of debt-collection as your default position, stop and examine whether or not it is working and how cost-effective it is. Then try the negotiated approach and see the difference it makes.