Instructions for the Implementation of the Debt Collection

Receivables is the amount of debt that is owed to the company from individuals or legal entities in the process of economic relations. Virtually no company operates without accounts receivable. It is an effective tool to attract new customers and suppliers thanks to the existing advance system, which allows you to attract additional funds.

What Steps Should You Make to Collect Debts?

Check the important steps that should be taken in order to collect a debt:

  • Call the client.
  • Drawing up a letter.
  • Meeting with the client.
  • Negotiations with the client, during which it is necessary to: communicate the general rules of your organization regarding accounts receivable; determine the responsible person of a competitor for the payment of receivables; agree with the client if immediate payment is not possible; take a set of other measures if the client refuses to pay or if he/she is rude during negotiations; set the frequency of your calls.
  • Record information on working with accounts receivable (CRM / automation of the process of collecting and recording information). In case of non-repayment of the debt within the prescribed period for the return of funds, two options are possible: an agreement with the debtor on a voluntary return or a compulsory collection.

Among the advantages in the pre-trial debt settlement should be noted the lack of additional costs for the trial, as well as the search for an additional opportunity to find a mutually beneficial solution to a potential conflict situation, without leading to negative consequences for the relationship and reputation of partners.

How to Ensure Constant Contact with the Debtors?

There are several ways to do this:

  • Sending reminders of the approach of the deadline for repayment of debt (regular and email);
  • Telephone conversations;
  • An organization of personal meetings with the management of the debtor company.

Among the financial methods of influence on debtors, we note:

  • penalties;
  • proposals for mutual settlements;
  • debt restructuring;
  • sale of debt;
  • initiation of bankruptcy proceedings.

The choice of a particular method depends on:

  • the characteristics of the debtor;
  • amounts due;
  • the number of days overdue;
  • the willingness of the debtor to repay debt and other factors.

Many had a situation where customers are in no hurry to pay, and at the same time resort to various methods of manipulation. Some refer to the real circumstances, including the lack of money at the moment, others use the emotional impact, including putting pressure on pity and resorting to aggressive behavior. So, it is necessary to follow the instructions to do everything the right way.