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Getting a Handle on Deadbeat Customers

Posted By ESA Communications, Tuesday, October 30, 2012

Everyone who provides monthly monitoring services has experiences with troublesome customers who don’t pay on a timely basis. Maybe "deadbeats” isn’t the right term, but we’re going to use it anyway. It holds bad connotations for the customer, and it should. That’s because the accounts you have to chase for payment are a constant source of headache.

You have to dedicate resources to pursue these customers. You send letters, make phone calls, and use valuable time that could be better spent on a service call or developing new business leads.

It’s important to minimize your time dealing with deadbeats, because the issue is never going to go away completely. Some customers just want to avoid paying bills. Some have trouble affording your service, while others just plain forget. Some think it’s a big game to get away without paying. Your challenge is to figure out which is which.

To work through these problems, start by establishing a regular callback routine for customers who are late paying. Give the authority to an individual or group within your company, and track their progress closely.

Next, write a strong letter to the customer encouraging payment. You may want to use legal counsel to ensure what you say is strong, fair and reasonable. But make sure the customer clearly understands the consequences if payment is not quickly forthcoming.

Final steps include sending the customer’s account to a collection agency or writing them off as not worth pursuing. You’ll have to decide what’s worth your effort, and that will likely come down to how much money you’re owed.

One big consideration with deadbeats is quickly determining whether someone is a good customer. You’ll extend extra consideration to customers who’ve been paying on-time for years but could suddenly be facing extenuating circumstances.

But for customers who quickly start off on the wrong foot, write them off and let them go. Most of the time, they will not be worth the headache.

That’s why they’re called deadbeats.

Tags:  accounts  customers  payments 

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