5 biggest mistakes people make when they DIY debt collection.
Collecting debts can be a chore. Especially if there is other productive work on your plate. From our experience at Tempest, here are some of the 5 biggest mistakes people make while making DIY debt collection:
Trust but verify
Customers or clients will often make up reasons not to pay. Some of these reasons may be valid, others won’t be. As the person on the collection side, it is if often easy to take people at their word and believe these excuses without any proof. This is a trap, if you can ask for proof of the reasons for the lack of payment this will deter a debtor from using excuses and delaying paying a debt that is due. Trust, but verify.
The need to chase consistently
It is not fun chasing debts (unless you are a special kind of person – and if you are then you should work for Tempest!). Because of this, your communication with your debtors will be patchy and lack consistency. This will only embolden the other side to keep delaying in the hope that one day you will just either forget or give up.
It is critical that you keep good records of what the debt relates to (i.e., the provision of the goods/services), your communications with the debtors and any details of disputes that arise or are resolved. This will enable you to layout the facts at any given time and prove that the debt is in fact owing and they need to pay.
It’s OK to ask for help
Culturally in NZ, we can have a problem asking for help. This is because on some level it is can be seen as a failure. This is not the case at all. Some debtors just need special attention, and this can mean; engaging a lawyer, briefing an effective debt collecting agency (we know and love Gravity Credit) or selling the debt to a debt buyer. Some debtors are just that difficult, I mean special…
Giving up ☹
When DIY debt collectors get tired of the chasing, brick wall responses or made-up disputes, they will give up and write the debt off. This guarantees them 0c in the dollar. It is not a great outcome (apart from for the debtor). Before giving up, we would suggest having a chat with Tempest to see if we may be able to assist in dealing with your difficult debtors.
If you have unpaid invoices and need help with your debt collecting situation, our team at Tempest can help you in dealing with your difficult debtors. Contact us today at [email protected] or call us on 0800 845 885.