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Whether you own or manage a business, one of the most challenging aspects can be managing the accounts receivable. Without good management and attention to accounts receivable, businesses can get in trouble quickly. The normal procedure is sending out statements monthly. After the monthly statements have been sent short notes are written or past due notices are sent. These notes will work for many of your customers or patients, but some will never respond. Some individuals have no problem working on the free money you have allowed them to borrow.
Charging interest is one way of encouraging payment. You may want to make your last and final notice using and hand-written personal envelope rather than your pre-printed business envelope. Many patients or consumers will open an article of mail that looks like anything but a solicitation or bill. If none of this has generated payment, it’s probably time for a call to the customer or patient.
When you make your call, be sure to be prepared. Have all your facts at your fingertips. If for any reason you are not prepared and have to call the debtor back, you may find they won’t answer the phone the next time you call.
It’s also always a good idea to have several ways a payment can be made to your business. If you accept payments by mail only, “The check is in the mail is heard more often than not. Of course the check will not be sent and you will hear the customary, “What? You never received my payment? I mailed it several days ago.”
Accepting debit cards, credit cards, or checks by phone will allow you to give several options to the debtor to make their payment. It also creates difficulty for the debtor to come up with excuses for non-payment.
When making the call, you might say, “Mr. Debtor, I’m callIng in regards to the past due balance of $400. I’m hoping we can keep this account in a voluntary status, how would you like to make your payment today?”
Becoming confrontational serves no purpose when dealing with your debtor. You can be factual and courteous at the same time. If the debtor makes comments such as, “I don’t have a checking account, debit card or credit card,” let the debtor know you will be in your office until a specified time and that you will need to have them deliver their payment to you today. Time frames are very important when dealing with the debtor.
Perhaps, you may want to use the strategy that company policy allows you to make one phone call before the account is moved to an involuntary status. This may psychologically suggest that paying the amount owed needs to be paid now before it is moved to an involuntary status. If the debtor sets a specific date to make the payment let them know if it is acceptable. Perhaps advise the debtor, unless their payment is made by the specified date you will have no choice but to move the account to an involuntary status.
The key to collecting on past due accounts is to translate a sense of importance. If you are going to place the account with a collection agency or take legal action you may want to state this to your debtor. Whatever you tell them the consequences will be, you need to follow through with your next step.
Whatever you do, remember that debtors are notorious for stalling payment, and time is truly a debtor’s best friend. | 
