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Advice From One B2B Collection Agency on How to Get Paid

November 11, 2021
By James Gussie

There is a lot of money to be made in the B2B collection industry. When you think about it, there are many ways that you can grow your business and get paid for it. Here we will look at some successful practices from one such company so as to help other companies succeed with their own ideas!

The “successful debt collection techniques” is advice from one B2B Collection Agency on how to get paid.

You’ve created a fantastic business strategy and have a list of prospective new clients. They want to pay after you’ve provided your goods or service, which is an issue.

This makes you nervous since the worst-case scenario is that you don’t get paid. However, since you’re new to the game, you’d want to make things as flexible as possible. What can you do to reduce the likelihood of this occurring?

Table of Contents

Know who your customers are.

Every week, a client will ask the Kaplan Group to collect from a business customer, but the paperwork does not clearly identify who the customer is.

Consider the following scenario:

It’s possible that there won’t be a purchase order.
The client may have several entities, and the documentation does not specify who is responsible.
It’s possible that the company was sold without the vendor’s knowledge, and the order came from an unknown new organization.
Instead of using the formal company name, the customer chooses a trading name or DBA.
The entity is described as a corporation or a limited liability company (LLC) on the papers, but it is not really registered.

You may not get compensated as a consequence of any of these problems. So, at the very least, be sure to get the customer’s legal name, physical address, and contact information (phone, mobile phone, email). Make certain that the legal name appears on every order or contract.

Look into your client.

Banks will not lend money to a client without first conducting a credit check. Vendors must follow suit. This information is often collected on a credit application. If you don’t already have one, the free eBook Credit Application Handbook has 19 examples and comprehensive explanations of everything you should think about.

You must verify and examine their credit once you get the information. Here are a few examples of what you can do:

A customer of ours recently completed a $30,000 consulting assignment without performing any of the above. We discovered their client had over $500,000 in tax liens, owned a dozen separate companies with almost $1 million in judgements, and had little chance of ever being paid in less than three minutes and for under one dollar.

Establish terms that include safeguards.

Your client must agree to your payment conditions, including what would happen if they do not pay on time. This information may be included in your credit application, contract, or purchase form. It should clearly indicate when payments are due as well as the interest rate that will be charged if they are not made on time. Make them liable for collection expenses and legal fees, if any are incurred in the process of collecting.

An acceleration clause that states that all sums are payable if one payment is late is beneficial if the client will have numerous invoices or a contract with monthly payments. If litigation becomes required, you may also wish to specify where it will take place. If the company does not have a strong credit history, request a personal guarantee.

All of these are typical conditions that your client will almost certainly accept as long as they are included in your original paperwork. But it’s too late to obtain these safeguards and the collection leverage that comes with them after they’ve fallen behind on their payments.

Invoice quickly and correctly, and follow up on time.

If you don’t submit an invoice, you won’t get paid. If your invoice is late, has errors, or is unclear, it offers your client an excuse to put off paying. Before an invoice is due, contact your client to ensure that they got it and that there are no queries or issues.

Follow up the first day an invoice is past due if they don’t pay on time. If your consumer knows you’ll let them pay late, they’ll take advantage of it.

Establish a process for following up on any overdue bills at regular periods. Consider the following scenario:

15 days before the due date, send an email to confirm that your client has received the invoice and has no issues.
- If you don’t hear back within four business days, send another email.
- If you haven’t received a response, give them a call.
Inquire about payment status the day after an invoice is due.
- If they claim payment has been sent, inquire about the check number, whether or not it is a complete payment, and the date it was mailed.
- If you don’t get a live person, call or email them every two or three days until you receive a response.
If you’re 15 days late and there’s no engagement, mail a past due letter and email a copy.
Call and email the accounts payable manager or finance executive with weekly follow up if the invoice is 30 days past due.
Call and contact the company owner when the account is 60 days past due. Explain that if they don’t pay, you’ll have to escalate.
Send a last notification by mail and email with a 10-day demand when you’re 75 days past due.
- After a few days, call the owner and finance executive to confirm that they received the notification.
When it’s 90 days past due, turn it over to a collection firm that specializes in B2B claims.

This may seem to be a significant amount of effort. But it’s nothing compared to the agony and financial loss of not being paid or being paid late on a regular basis.

Cash flow is essential for all businesses, and if you don’t keep track of your receivables, things may rapidly spiral out of control. Exceptions to these rules are always possible. The idea is to establish a set of processes that you adhere to regularly, with deviations only made when necessary.

Don’t be hesitant to demand the money you’re owed and to put a stop to supplying services or goods until all past-due bills have been paid.

If a child is delinquent, take immediate action.

The Commercial Law League of America has collected survey data over many years that indicate that the odds of collecting an invoice drop by more than 1% each week after it is past due.

When an invoice is 90 days past due, there is already a 26% probability that it will not be paid. By the time it’s seven months past due, there’s a little chance you’ll be able to collect.

The majority of collection agencies operate on a contingency basis, which means you only pay if they are successful.

When an account requires particular care, the sooner you entrust it to a reliable commercial collection agency, the greater your chances of receiving anything rather than nothing.

The “action plan for debt collection” is an article that provides advice on how to get paid. The article includes tips and tricks that will help you get out of debt.

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Frequently Asked Questions

How do you collect payment from customers?

A: We have a payment processor called Stripe. They handle all of our transactions and credit card information for us so that we dont have to worry about it ourselves.

What is B2B collection process?

A: B2B is the process of taking over a company by buying all their shares.

How do you convince a customer to pay its debt?

A: If you do not want to pay for an item, then simply stop buying it. Furthermore, if the person behind this debt is a close friend or family member and they are not willing to work out a deal with you, then try talking to them about what will happen in the future should their behaviour continue.