Receivable Management: Some signs your receivables may be in jeopardy

Receivable Management: Some signs your receivables may be in jeopardy

By Glen Hutchinson,
August 15, 2009
 

Everyone that grants credit, to businesses or individuals, or a combination of both will run into a receivable management problem. Many companies are guilty of not putting the proper onus or the correct person in charge of their receivables. Some companies will actually put their least competent employee in charge of their receivables. This may be an older employee whom soon will be retired.

Lets call her Marg. Marg has been a loyal employee for years and is only 18 months away from retirement. She may be getting “a bit dotty” but what to do with her? Yes, lets put Marg in charge of the receivables as she can’t do any harm there. So now you have your least competent employee in charge of you incoming money life line.

What do you think may very well happen the first time Marg calls even a semi abusive receivable problem? It very well could go to the bottom of the list never to be called again.

Several of the most common indicators that your receivables may be in jeopardy.

  • Unreturned Phone Calls.

Usually this is thought of as an avoidance tactic and generally it is exactly that. The debtor or debtor company is avoiding you because either they don’t have the money to pay you or they don’t want to pay you.

  • I have applied for refinancing or else my company has applied for refinancing This is not to be confused with restructuring. Restructuring is generally more with businesses and restructuring to me means sue immediately.Always ask the person you are trying to collect from the name and phone number of the person they are doing the refinancing through. If the information is not given voluntarily there very well be no merit to it.
  • All my books are at my accountants.

Simple enough. Ask for the name and phone number of their accountant. If the information is not given freely it very well maybe a stall tactic. If you get get the name and phone number of the accountant, ensure it is not the wife of your receivable problem.

  • My lawyer has advised me not to pay.

When you ask for the name and phone number of their lawyer, the probability of you getting it is quite limited. This is a generally a fairly aggressive stall tactic.

  • Broken promises to pay.

Postal service in Canada is of the highest quality and I assume in the United States it also superb.If you have had broken promises to pay in the past request the money is deposited directly into your account. If that can not be done for whatever reason, request the money be shipped to you via courier and the debtor or company emails or faxes you proof it has been done.Request the debtor drop the funds off at your office immediately or, if possible, have one of your employees attend their office or residence to pick up the money. A case of urgency has to be stressed here as it is an urgent matter. It is your money that is at stake.

There certainly are other indicators that should set off warning bells with you. When you do isolate your receivable problems it certainly is in your best interest to take immediate strong action. Two solutions are to utilize a collection agency or commence litigation yourself. Whatever remedy you believe is best for your purposes, don’t wait, do it now. Receivable problems do not correct themselves.

Happy collecting.

→ Back to Articles

Comments are closed


  • We set a high standard for collection service efficiency by using our knowledge and experience, in conjunction with a burning desire to succeed.