People who have to make collection calls don’t always know how to approach the call. They may not have their responses ready for the questions or excuses that the customers put forth.
There are methods of requesting payment on the phone that can work very well. However, some methods will not achieve the response your company needs. You and anyone who may be doing the collection calls must understand how to make better collection calls.
Why Phone Calls?
Some companies rely on debt collection letters rather than making phone calls. They feel that this is easier than calling clients or customers who are not paying their debts.
However, the truth of the matter is that they are simply not as effective as a phone call. Phone calls are far more successful when it comes to maintaining your cash flow.
Of course, with some customers, phone calls have the potential to become hostile. These phone calls are stressful to handle, which is why many companies continue to send collection letters. Proper handling of the phone call can help immensely.
Therefore, your company needs to know how to start making better collection calls.
Preparing for the Call
Those who will be making the collection calls must be fully prepared for the call. You need to be sure that you have all of the necessary information available including the account number, the amount owed, invoice numbers, dates, purchase order numbers, and so forth.
Have all of the account information easy to find when the customer has questions. This will ensure that you do not have to scramble for information.
Take a deep breath before calling and remain calm. You never want to be the one to come across as hostile or angry. You do not want to come off as believing that you are “better than” the person who owes money.
Urge your team to always listen to what the customer has to say. There may be legitimate reasons that they have not made a payment, but there are also excuses that they may try to use to get out of paying. Learn to spot the differences. This takes time to learn.
Sometimes, the customer won’t be capable of sending the full amount that they owe. In that case, try to be flexible and set up a payment plan that results in a win-win for both parties. This way, they are still paying something toward their debt.
Have an idea in mind of the types of plans that you would be willing to accept before you head into the phone call. In all of these cases, you will want to have a firm promise in hand and you will want to create a deadline by which the money will be received.
Without a promise and a deadline, your company will find itself in the same situation needing to make the same call again in a few weeks.
Always Remain Professional
When you call, it is important to create a professional, but not aggressive, tone immediately.
You will want to introduce yourself and the company you represent, and make sure that you are talking to the correct person. In some cases, it might be an individual. Other times, you might need to speak with the client’s accounts payable department. It will depend on the nature of the debt.
Be sure to clearly let them know why you are calling and ask when you can expect to receive the payment. Listen to how they respond.
In some cases, it might be an oversight, and they will be able to send the payment right away, or they might promise to send a payment soon. If they make this promise, make sure that it is documented and that you know when you should be receiving the money. Document this promised date and let them know that you will give them a call if the payment has not been received.
Other times, they might have a cash flow problem. In those cases, you will want to let them know that you can set up a payment plan with them, or that you can take a partial payment now. Again, you will want to make sure that you note everything about their promise to pay. If you are going to be setting up a plan or a partial payment, you will need to first ask when and how the money will be paid. Then, you can negotiate with them about how much they are paying.
Let them throw out the first number that they say they are willing to pay but do not take that number. Ask for more than you think you can get. You can then have a back-and-forth with the customer to reach a plan or payment that will be agreeable to both of you for now.
Sometimes, the customer might claim that they have already paid the debt. In those cases, write down everything that they have to say about when they paid, the amount, and other details. If they have a confirmation number, you will want to get that information, as well. Tell them that you will investigate the matter and follow up with them.
There’s a chance that it could be an oversight on the part of your company. However, it is sometimes a stall tactic that customers and clients use, so you need to be aware of that.
Once you have nailed down the payment or plan with the customer, you can then end the call. Ask them if they have any other questions and thank them for their time.
Dealing with Hostile Calls
In some cases, the calls can become hostile. When this happens, you must stay calm. Responding with aggression in kind will come across as highly unprofessional, and it will not get you closer to collecting the money owed to you.
It can sometimes be difficult to handle being on the phone with customers who are angry and who are berating you and your company. You know that the problem lies with the customer who didn’t make the payment, but it’s sometimes hard not to take the things they say personally.
In some cases, it is better to let them know that you’re ending the call and that you will contact them again.
Mistakes to Avoid
Just as there are things that your company should do when making collection calls, there are also things that you’ll want to avoid.
One of the issues that people have when they are trying to make a phone call to collect a debt is beating around the proverbial bush. It is important to get straight to the point rather than talking about other topics to develop a rapport. Remember, you need to be professional, and you need to be sure that you are clear about why you are calling right from the start. As soon as you introduce yourself and the company you represent, you need to let them know the purpose of the call.
Another problem is that the callers are not specific about what they want from the debtor. You can’t simply ask for “something” to help pay down the debt. This gives the customer too much leeway. They will send a tiny payment since you weren’t specific and did not take the time to hash out a plan with them.
Additionally, you do not want to ask for the reason the customer hasn’t paid. If you do, the customer is likely to trot out their issues to try to get sympathy as to why they haven’t paid.
Asking about the problems invites them to give you a long story about why their payment is late, and you likely don’t have time for that. The customer will still probably provide a reason as to why the payment is late, but you don’t want to start that dialogue on your end.
By avoiding these potential mistakes, it can help the phone call to go smoothly, and it can increase the chance of getting the payments your company needs.
Outsource to a Professional
The methods discussed above can help you to improve the success of your debt collection calls. However, many companies still do not want to handle these types of calls on their own, and that is understandable.
If you are having little success with collecting debts over the phone, it might be time to outsource. Professionals who know and understand how to handle these types of calls can help to reduce the hassle that you are facing.
Even better, they can help to ensure the debts owed to you are finally paid, which helps your company improve the bottom line.