Signs That Your Regular Customer May Not Pay on Time
Like the owner of any company, you may have a set of loyal customers who you rely on for regular business. To cultivate these relationships, you may offer these clients personalized service, extra perks, special payment plans, and great customer service. They, in turn, may reward you with steady orders that help you meet your fixed costs.
Dealing with such clients when their accounts are past due can be tricky. On one hand, you want to maintain this valuable relationship by giving them more time to pay. On the other, you can’t afford to wait too long. Your business may need the revenue to meet operational costs and you also recognize that debt grows harder to recover with time.
At Summit A*R, we’re considered a reputable commercial debt collection agency because we take a diplomatic approach to debt collection. Whether we’re dealing with consumers or businesses, we treat them with respect. We follow a “P.H.D. Philosophy” (Preserve Human Dignity), which means that we don’t resort to harassment, threats, or robo-dialers. Such tactics are counterproductive because they only irritate people.
We are stern but friendly. With over two decades of experience, we know that most consumers and businesses want to pay off their debts. We help them find a way through our skilled negotiation methods. And it works. At Summit A*R we’re proud to have a recovery rate that’s twice the industry average.
We know that you’ve put effort into developing your reputation and your valuable business relationships. When you have a delinquent account with whom you have a history, you want to recover your revenue without hurting your company. With highly trained, licensed, professional, friendly, and experienced staff members, we are equipped to handle delicate situations.
To improve your chances of successful debt recovery from a regular customer, it’s important to recognize the red flags that they may not pay on time.
#1 They Are Changing Financial Partners Frequently
Most healthy businesses maintain long relationships with their banks. However, this can change occasionally. There’s no reason to be alarmed if your client pays you from a new bank once. But take it as a red flag if they’re paying you from a new bank frequently. You may consider doing a new credit check to make sure everything is in order.
#2 Their Orders Are Unpredictable
There are many reasons why a client’s orders may become unpredictable. Perhaps they’re a seasonal business experiencing a downturn, or they may be testing another supplier. However, if the product is still in demand from other clients, then your regular customer could be experiencing a financial crunch. You may want to quietly investigate why they’re unable to stay current before their account turns delinquent.
#3 They haven’t paid in 90 days
This is an obvious red flag. If your reliable customer with a history of timely payments has not paid you in three months, then you need to get in touch for more info with the specialists at Summit A*R immediately.
We have recovered some particularly difficult debts over the years. Usually, debtors are willing to work with us after our campaign of phone calls and emails. The involvement of a good debt collection agency is enough to motivate them to pay their dues.
Unlike your in-house collection department, at Summit A*R we can report consumers and businesses to the credit bureaus. Businesses value their credit scores because they allow them to secure important financial loans from banks and pass credit checks when dealing with other businesses. However, credit reporting is optional. We won’t take this step if you don’t want us to.
Contact Summit A*R before the debt becomes harder to recover. A 90 days past due account can easily become 120 days past due.
#4 They Have Stopped Purchasing
If your regular client has stopped buying and haven’t cleared their invoices, then stay sharp. Even if they can pay, they may not be motivated to pay on time if they plan to end ties with your company. Get in touch with Summit A*R if you’re concerned about this customer.
#5 They have Stopped Responding
Even if your regular customer is in a temporary financial problem, they should continue communicating with you. If they have stopped responding to your invoices, phone calls, or emails, then don’t hesitate to get in touch with Summit A*R.
Not only do we regularly recover commercial debt but we have also been serving your consumer debt collection needs for over 27 years. If your client has stopped responding because they’ve skipped town, then we can find them with the aid of our skip tracing department, which is led by a licensed private investigator. Using cutting edge resources unavailable to other debt collectors, we can find your delinquent customer and their assets even if they’ve crossed state lines. We are also well-versed in local state laws. Using this knowledge, we can formulate a plan for debtors in other parts of the country. Our skip tracing services are provided free of charge to our valuable clients.
#6 The Account Is in Trouble
Even if the account is not past due, it’s important to be mindful of their financial situation. For example, if they are behind payments to other vendors, have a high labor turnover, are losing stock value, or facing other financial hurdles, then their account may go overdue in the future.
#7 They Have Recently Had Some Disputes
In the course of any business relationship, it’s normal to have disagreements. Perhaps you sent the wrong product, or the service wasn’t up to standard. Maybe there was some confusion over the invoice, or you didn’t deliver on time due to reasons beyond your control. Regardless, it’s important to resolve any concerns with a regular client amicably and use them as a learning experience. If a dispute is unresolved and the invoice remains unpaid, then the customer may also refuse to clear future invoices on time.
These are seven signs that your regular clients may not pay on time. While it’s important to maintain a good relationship with your customers, you should also be mindful of warning signs. Hire an agency like Summit A*R for help with recovering revenue from such accounts. We specialize in collecting debt while preserving your business relationships and your reputation.