Credit Granting & Collection Techniques Part 2

Symptoms of Potential Collection Problem

Broken Promises:  If your customer promises payment then neglects to keep the promise.

Unreturned Phone Calls / Messages:    If a customer avoids your calls, he/she is avoiding payment of debt.

Screening Calls:  If a customer is always in a meeting always away from their desk, always busy, always out of the office, etc.,  you have a potential credit risk.

Places Large Orders:    If your customer all of a sudden places a large order, be suspicious and investigate thoroughly – you could be getting set up.

Changes Bank:   People change banks usually for a service reason or a better rate. Be sure it is not for the wrong reason.

NSF Cheques:    No matter what excuses your customer gives you, a NSF Cheque is a definite “No-No” and should not be treated lightly.

Post-Dated Cheques:    Although not always, post-dated cheques are an indication of an under-financed business or one with bad cash flow. Either way it is a sign of caution.

Sporadic Buying:    If your customer’s business or product line is not seasonal, sporadic buying could mean your customer jumps from supplier to supplier and has no loyalty. (Usually this type only pays the bills when he/she gets a new order.

Cannot Pay Until Their Customer Pays:    This is a poor and inexcusable reason. Move fast on this one because cash flow is a problem.

 

Blog by Dan Tocchet
Canada Legal Referral   www.canlegal.net