Sure your collectors would love to turn debtors upside down and shake the money it owes your company out of them. These five techniques are just as effective - and won’t get a restraining order issued against anyone.

No doubt your company’s collectors know what works for them. But no matter what their style, there are certain best practices that all staffers charged with reducing DSO should be using.

Compare your existing A/R practices against this list of must-dos:

Best Practice #1: They don’t wait

Many companies establish a grace period before they sic the dogs on past-due accounts. Big mistake — you’re leaving the door wide open for customers to take advantage.

Adjust your reports to kick out a list of customers the day they go past due and get collectors on the horn that very day.

Best Practice #2: They call at the right time

When they do get ready to call, the best collectors know what window to pick up the phone. The last thing you want to do is give customers an easy excuse not to answer your calls.

The optimal collection window: between 9 am and noon in the customer’s time zone. If you have full-time collectors, encourage them to use this zone for your biggest balance customers — save the small dollar amounts for after lunch.

Best Practice #3: They don’t leave messages

There’s lots of info out there on how to craft the kind of voice mail that gets debtors to call you back. Go one better: Skip the voice mail altogether.

If your staffers don’t reach the person they’re after, encourage them to try again later, without leaving a message.

You want your company to have the advantages of timing and preparation in the call.

Best Practice #4: They use the ‘two and up’ rule

That being said, you don’t want your staffers trying to reach the same person for days on end. Every day that passes is another day added to your DSO.

Instead embrace the “two and up” rule: Once your company has tried unsuccessfully to contact a specific contact twice, move one step up the chain of command:

• A/P clerk
• A/P manager
• Controller
• CFO
• CEO or owner

Best Practice #5: They know when to shut up

But what about when your collectors do get a past-due customer on the line?

The less you hear the better — silence is one of the most effective weapons in a collector’s arsenal.

Yes, it can be tough to get used to. But once your staffers state the reason for their call, they should wait silently and let the debtor take it from there. A few seconds of uncomfortable silence will spur the debtor to say something and that usually translates into a better outcome to the call.

Tags: A/R Practices, Collection calls, DSO, Techniques