Collecting accounts receivable - Four Principles of collection management

It can be a professional debtors, creditors, employer, tax collector or third parties.

You can be a, doctor or lawyer, accountant. In fact, if you're in business, it is likely that you or someone within your company is engaged in the task of raising money for past due accounts. And you want to be able to do it as efficiently and quickly as possible. You also want to do it legally.

I have worked with thousands of people who collect money to help them improve their collection techniques. And I learned that if you follow what I call the four principles of collection management, which will greatly increase your success. Moreover, these principles will help you keep out of legal trouble.

Here are the four principles of collection management:

1. Collect the money. Our primary task is to collect the money as close as possible to the terms of the contract. And there should be no question as to why we are collecting the money. Our customers (patients, clients, partners) need to understand that they have a contract, the legal and moral obligation to pay within the terms of the contract. We must understand that it is our job to make sure it gets done.

2. Systematic follow-up. If you could choose one element of the management of the collections that I think needs the most improvement would be a systematic follow-up. It 's usually done inconsistently and without a very good system. Someone said that 80% of success is just showing. And in the business of collecting money, systematic follow-up is about constantly revealing.

3. Discussing the bill. Once you get the debtor to discuss the bill are already on track to collect the money. The best collectors I have ever seen do not do much talking. They get the debtor to do the most talking. And if I could choose a skill that I think is more important than all the other skills in doing the business of collecting money and I would say listening skills.

4. Keep good will. Just because you have customers who have a problem now, does not necessarily mean that customers will not be good in the future. And not many of us are able to lose many customers. Any marketing professional will tell you that it costs much more to find new customers than it does to retain those we already have.

In future articles, which will expand on the four principles of collection management. As we end 2008, the economy is slow. The debts are increasing at an alarming rate. In 2009, it is more important than ever to stay on top of delinquent accounts .......