It sounds simple, right? Pick up the phone, ring your customer and let them know you’re expecting them to settle their overdue account. Unfortunately, it’s not always easy. If you haven’t prepared, the call can quickly take a wrong turn. Or, an emotional reaction from the recipient can easily throw you off your game. Here are a few tips for making a successful debt collection call.
Prior to the call
First and foremost, familiarise yourself with the rules of conduct for people attempting to collect a debt. In Australia, the ACCC/ASIC defines the guidelines for debt collection.
Before you punch in the number, get prepared for the call. Find a quiet place where you can take notes. Remove any food or drink from the immediate area and spit out any chewing gum.
If possible, have a script with questions in front of you to ensure you don’t forget to ask anything.
Make sure you have all the information about the debt on your desk.
- How much is owed
- What were the terms of the sale
- What was actually purchased
- When was the invoice supposed to be paid
- How many other invoices are outstanding, even if they’re not overdue
- Payment history of the debtor
During the call
Remain confident and project a pleasant but firm tone. There’s absolutely no need to sound threatening. Use a lower register in your speaking voice to instill a sense of calm. Sometimes a high-pitched voice can sound shrill which indicates stress. Speak clearly.
Introduce yourself and your company and explain the purpose of the call.
Ask the debtor when you can expect full payment of the debt.
Use open, neutral questions that encourage the debtor to give you information. For example, “How do you intend to pay this debt?” is an open, neutral question and can elicit any number of responses. “Can you pay with cash?” is a closed question and allows the caller to simply say ‘yes’ or ‘no’ – even if it’s not true.
Listen carefully and take notes. Occasional short silences may persuade the debtor to continue talking and give you more information in the process. Allow a few gaps in the conversation and see what happens.
Before you hang up
Do not get distracted by another activity or go on ‘auto-pilot’. This is not the time to multi-task.
Ask for payment. If the debtor is insistent they can’t pay, try to negotiate a payment plan.
Summarise the results of the call before you hang up to ensure both parties are in agreement on the terms.
Keep in mind
The person on the other end of the line could be experiencing a fair degree of stress due to the call. Ensure you maintain a professional attitude throughout the call. Be prepared for emotional outbursts and have a strategy for staying calm and keeping the conversation on track.
While it probably isn’t the most pleasant task, taking decisive action against overdue invoices as soon as possible is the best strategy for recovering your debt. Maintain a confident, professional tone and don’t allow the debtor to control the conversation. Be polite and firm and ensure you summarise the call with the debtor before you hang up.
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Natalie Walker
Natalie Walker is managing director of Blitz Credit Management (www.blitzcredit.com.au), a technology-driven debt collection agency based in Australia. Her modern approach to debt collection and credit management services has been widely embraced by Australian businesses. She can be contacted at (08) 6140 2584.
