Avoid the Five Most Common Pitfalls to Get Paid as Agreed

The following five excuses account for 93 percent of the excuses used for not paying an invoice on time.  As you review each reason, consider how you might position those responsible for payment collection in your business with a scripted answer to each excuse so they don’t get derailed in their efforts to get you paid for the work you should have been paid for:

1. The finished work was not satisfactory or correct: Determine the problem and arrange for the appropriate person to investigate, correct, and resolve the problem.  This communication should be written and appropriately marked.  Upon notification of the resolution of the problem, the customer is called, and the commitment for payment is requested.  Under no circumstances should the individual responsible for collecting Accounts Receivable negotiate a reduction in the invoice to secure payment.  This excuse is blunted in most instances by using the customer service call before invoicing.
2. The invoice is incorrect: Seek to understand where they believe they are being overcharged, then go back to the job records to confirm whether their perception is correct or in error.  If they are right, immediately reissue the invoice.  If they are wrong, make copies of the signed agreements that established what would be invoiced and resume collections follow-up.  This is another avoidable situation through the use of the customer service call upon invoice submittal.
3. We never received your bill: Verify to whom the copy of the bill should be mailed and the address.  Obtain their fax number or email address and send a copy immediately. Indicate you will also mail a hard copy.  Ask when they will make the payment after receiving your invoice.  Mail copies and follow-up in five days to verify receipt of the duplicate statement and get a commitment for payment.  This is another avoidable situation through the use of the customer service call upon invoice submittal.
4. We don’t have the money to pay you: Politely ask when they will have it.  Get a definite commitment for the date when a check will be mailed.  Make a note of it and call that day to ensure that the check has been mailed.  Ask for the check number and amount as a means to ensure that payment has been made.
5. We have paid that bill, or the check is in the mail: Get the check number, amount, and date mailed.  If the check has been in the mail for more than seven days, request that the customer issue another check noting that stop payment on the first check is unnecessary because it will be returned, not deposited if received.

Regardless of the excuses given, the purpose of every collection contact with a past-due customer is to collect the money that is due.  If done respectfully and consistently, each follow-up will advance your relationship with your customer through professionalism in doing what you say you are going to do.

Click here to learn how best to set up an A/R collections process to improve your odds of getting paid the money owed to you.