How to Be an Effective Debt Collector

Tue, 19 Feb 2019 00:00:00 -0800

If you ask entrepreneurs what one of the worst aspects is about running their business, most will answer, "Collecting overdue invoices."

Managing accounts receivable is an essential part of running a business, second only to getting and keeping clients. Receivables are how you pay employees, produce products and run your business.

When a client doesn't pay, you have to address it. But it's also difficult and can be even more sensitive depending on how customers react. 

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  Ways to Improve your debt collection process

There are a few ways to become more effective at debt collection. Follow these tips to make collecting overdue invoices a little easier.

Be prepared

If you think calling a client to request payment is uncomfortable, imagine how much worse it could be if you are wrong. Before picking up the phone, do some digging and make sure that payment was never received, or that the client never talked to someone in your organization to renegotiate payment terms.

It's also worthwhile to understand your client's business and learn about whom you'll be speaking to. Don't start a collections conversation with the wrong person at the company. Politely ask and ensure you're speaking to someone who can talk knowledgeably about the company's bills and make decisions on payments.

Educate yourself

You'll feel like you're on steady ground if you make a collections call with an understanding of what your rights are. Learn your rights and what the regulations are for B2B collections in your area.

Knowing what you can say and do will help you confidently negotiate with a client whose payment is past due. It also prevents you from taking an action that could jeopardize your legal position, should it come to that.

Document, document, document

When talking to a client about an unpaid invoice, take copious, detailed notes. Document who you talked to and the date and time. Take notes on what your client says. Keep copies of emails exchanged and letters sent. Compile your contact notes and keep all your documentation together. You may need it in the event of future legal action.

Don't make assumptions

Don't assume anything about why you haven't been paid. It's shocking how many companies simply forget to pay an invoice and are more than happy to take care of it once they are reminded of it with a simple and friendly letter or phone call.

Also, don't assume your client's excuses are, well, excuses. They may be valid reasons as to why the company is struggling to meet its obligations.

Stay professional

There are a lot of negative emotions tied up with collections. There is worry about making your own payments, concern with how unpaid invoices will impact your business, and anger over your work being disrespected. It's also easy to feel like you're being taken advantage of.

Put all that aside when talking with a customer about unpaid bills. As mentioned, they may have just forgotten or may have a legitimate reason for delaying payment. Expressing anger and lashing out isn't likely to get you paid any faster, and it might also lose a good client who is simply going through a rough patch or is forgetful.

Establish payment terms

Whatever the reason for the late payment, work with the client to get a commitment from them to balance their account. You may consider taking a lesser amount to get the unpaid invoice off your books. Or offer to set up a payment plan if you think the client wants to pay you but doesn't have the means at the moment.

Regardless of what you agree to for remittance, find out when and how they plan to make a payment and document the information. If you offer a payment plan, be sure you are both clear on how that will work, and, again, document the agreement.

Follow up

Until you receive payment, be prepared to follow up. Start with documenting and sharing any payment agreements you came to in your discussions, whether those were for a payment plan or a new date.

If a check doesn't arrive when expected, follow up within a few days of the missed payment. Continue to remind the client that they owe you and that you're not going away until they have lived up to their end of the agreement.

Consider Hiring a Debt Collector

If all else fails, consider hiring a professional to handle your collections. You should expect that any client you send to collections won't be continuing the relationship. Then again, do you really want to provide products and services to someone who doesn't pay?

Tue, 19 Feb 2019 06:00:00 -0800

Clicking a link and ending up on a 404 page can be upsetting for website users, but many companies have turned this less-than-ideal experience into a chance to build their brands.

Whether it's Amazon showcasing its employees' dogs or Pixar featuring a character from its popular movie Inside Out, many companies use 404 error pages to amuse readers and direct them to other portions of their website.

One of Amazon's 404 error pages.

Business.com community member Alex Clark recently asked, "Is it really worth having a custom 404 error page on your website?" The short answer to Alex's question is yes.

"It is very easy to create a unique 404 page, so I don't think it is even a decision whether or not to do it," said Jeff Moriarty, digital marketing manager at Tanzanite Jewelry Designs. "You just need to do it. Think about the potential increase in visitors going on to another page on your website instead of hitting the back button because of the default 404 they see everywhere else. I honestly don't see a downside to using one."

We spoke to a handful of marketing professionals and learned of a few key benefits to having a 404 error page on your website's business.

Reduce negative emotions

The initial reaction of clicking a link only to have it lead to a 404 error is likely to be negative. Creating a unique 404 error page can quickly turn frustration into a laugh.

"Finding yourself on a 404 page can be a frustrating experience for a user – you've essentially dead-ended in trying to find the thing you're looking for," said Christine Austin, creative lead at IMPACT. "Because of this, creating a 404 page that eases that frustration – either through playful content, visual elements or suggestions to getting them to the right place – can be a great way to ease that negative emotion." 

Companies like Drift and HBO have turned their 404 error pages into opportunities to make website visitors laugh. Turning a negative experience into a positive one is an important benefit of creating a unique 404 error page.

HBO's 404 error page.

"It also appears that you, the company, took the extra step to make sure you are creating the best experience for your users, even if they end up on a page that no longer exists," Austin said. 

Keep users on your site 

When used properly, a unique 404 error page keeps website visitors navigating through different portions of your site. 

"Funny 404 pages can definitely help to diffuse some of the frustration in visitors who can't find what they're looking for," said David Mercer, head of online strategy and new business at SME Pals. "However, funny is still not as good as useful in this instance. More often than not, users will simply hit the back button on their browser and look elsewhere. Unhelpful 404 pages can drive valuable traffic away by providing a poor user experience."

Arguably the most important reason to create a unique 404 error page is to direct traffic back to your site. You can include hyperlinks to your homepage, your most popular content or even articles that are trending that day. The degree of detail on your 404 error page is up to you, although a link to your business's homepage is a good starting place for nearly every organization.

In our discussion on Alex Clark's question, Business.com community manager Taylor Perras stressed the importance of keeping users on your site. Don't let a simple 404 error be the reason a visitor leaves your site.

"Don't let your 404 page be a dead end," Perras said. "At the bare minimum, add a [call-to-action] back to your homepage for the user to begin their search over. If you have the ability, serve up general content that relates to your industry or talks up your business." 

The Business.com community members also had some advice: "You can also use your 404 page to get other insight into your visitors' behavior. A broken link can come from anywhere -- internal to your website, or external -- so having a custom page with Google Analytics code will enable you to get some insight into where the bad link exists and give you an opportunity to do something about it," said Chris Martin, managing partner at Brass Ring Consulting Group and Business.com member.  

There's no reason to let potential customers walk away from your website. A custom 404 error page doesn't have to be funny, but steering users back to your site to find what they're looking for is a digital marketing best practice.

Showcase your brand

If you run a marketing firm and someone lands on your 404 error page, take the opportunity to show off your creativity with a funny or engaging page. If you run a restaurant, you can crack a joke or include links to your homepage, menu or contact information. Some businesses may opt for all three options. The exact specifications of your 404 page depend on what best aligns with your business.

"The error page should match the look and feel of the rest of the website," Perras said. "An unfamiliar looking page will surprise the user and make them feel like they are somewhere they aren't supposed to be, causing them to leave the site."

The best 404 pages stay true to your brand's image and voice. Don't try to be something you're not. If your business gives off a serious vibe, making a joke might not be the best play for your 404 page. Stick with what's helped make your business successful previously. In the end, many users just like custom 404 pages that help them get to where they wanted to go.

"A uniquely designed and interactive 404 page shows the brand's quality," said Nina Krol, content marketing specialist at Zety. "If the webmaster has put an effort into taking care of the error page, you can probably expect an extraordinary experience from the functioning part of the web page. Interacting with a visitor on the 404-page level is a way to admit that something has failed but not to let the visitor go and to show that you care."

The bottom line

It's a good idea to create a unique 404 error page. Putting in a little extra effort into an error page can show users that you care about their experience on your website. The page also keeps visitors on your website and gives your business a chance to showcase its personality. Making a custom 404 page is a smart business decision.