Why did they pay you and not me?

The debt collection process involves a good deal of focus and persistence.

Debt collection is what I do for a living. I have the luxury of being able to focus on it. Business owners have no such luxury, as they wear many hats.

It is all too easy to get caught up in day-to-day operations or customer service, and neglect aging accounts receivable.

Many small business owners have designed an in-house collection process and use it well. They call delinquent customers and send them a well-worded collection letter.  Their efforts produce results, but since they have other things to do, they can only do so much.

Successful debt collection also involves escalation. Again, many business owners use an escalating process involving senior management before sending a file to a collection agency. And again, it works sometimes.

The key is to continue the escalation by hiring a collection agency. A collection agency can move the process to the next level. If your customer cares about impact to their credit rating, they might just pay when contacted by a collection agency. They may pay the bill after receiving multiple collection calls, just to make us go away!

Sometimes, we use our best stuff, and still cannot get someone to pay. In those cases, I may make a referral to an attorney for litigation. And sometimes, they pay when they get served by the lawsuit, causing me to ask, “Why did they pay my lawyer and not me“?

The answer, of course, is escalation. Ask yourself, “What will motivate this person to pay?” and DO THAT THING!