10 excuses for not being paid  (and 3 easy ways to deal with them)

When you work in collections or order to cash process management, excuses are part of the job – and from our experience, it doesn’t take long for even the most creative explanations for non-payment to start sounding like a broken record.

Waiting on payments

But have you ever wondered what the most common excuses are? Well, the people over at Federal Management, a UK debt recovery and legal services firm, have gathered up a list of their most commonly heard excuses and delay tactics.

The results? They’re not particularly surprising, but at least we feel in good company having read them. Basically, you’re not alone whether you’ve heard these phrases one or 100 times this week:

  1. “The cheque is in the post.”
  2. “We haven’t received any invoices.”
  3. “We disputed that invoice.”
  4. “The account signatory is on holiday.”
  5. “That person is not available right now.”
  6. “I’m waiting to be paid.”
  7. “We don’t process payments until the end of the month.”
  8. “Our payment terms are 90 days.”
  9. “The invoice has already been paid.”
  10. “We’re having technical difficulties.”

Faster payments and happy customers?

While some of these excuses are classic smokescreens and avoidance techniques, they occasionally turn out to be the truth. But even when a customer isn’t fibbing when they utter these phrases, the fact of the matter is that they owe you money. And if that money isn’t paid on time, it could cause problems for your cash flow.

Here at OnGuard, we realise that chasing payments can be a difficult task – but there are also three simple things you can do to make the process easier. We don’t promise that these methods will always work, but they should help you to improve cash flow and reduce DSO in many cases.

  1. Open lines of communication – Talk to your customers, send letters and emails, remind them that payments will be due soon, or today or yesterday. As well as communicating with customers, you also need to ensure that everyone within your organisation is sharing relevant data. If an account manager learns that a customer is moving premises, the collections management team needs to know about it.
  2. Make your payment terms clear from the start – Make sure that your payment terms are discussed during the contract phase of the new business process. This will give you plenty of time to iron out any issues – and remember: it’s the terms that were agreed upon that matter, not the other company’s standard procedures. Be sure to also include your payment terms on all invoices. Most clients won’t even notice them, but it does occasionally help.
  3. Have the right tools – From organising data, through to automating tasks and generating reports, many aspects of credit management can be streamlined and simplified just by using the right software and other tools. If you’re still using Excel or another spreadsheet programme, then you’re risking data accuracy, as well as your team’s ability to work effectively.

Contact

If you’d like to learn more about how OnGuard credit management software can make a difference to your credit and collections management – and cut down on the number of excuses you hear every day – please get in touch via contact@onguard.com or via +31 (0)294 256666. Follow us on Twitter and LinkedIn to stay up to date.

Or request a demo and see what we can do for you

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contact@onguard.com