Getting invoices paid efficiently requires a number of elements coming together smoothly. Client complaints can often get in the way of cash flow – and this is especially true in the case of a contractual dispute, where customers may choose to withhold their payment until the issue is resolved.
Contractual disputes come in all shapes and sizes, and they can cause problems for various functions in your organization. They can certainly lead to difficulties for order to cash, as it increases DSO and damages the customer relationships you’ve worked so hard to nurture.
So, what should you do if a client has a contractual dispute? Here are some tips to help you get the situation resolved as quickly as possible:
- Don’t take it personally – Remember that whatever the contractual dispute is, it’s not a personal attack on you. It’s a business issue, and you need to act on the complaint in a professional manner.
- Do take it seriously – It can be easy to dismiss a contractual dispute as an unfounded complaint and an excuse for a customer to not pay their bill. But remember that these are usually genuine and that finding a solution could actually lead to overall improvement in your business and a stronger customer relationship.
- Find a resolution quickly – Fast action can help to prevent a problem from spiraling out of control. Often, you can work with a customer to find a solution that isn’t costly, and which avoids you from having to go to court.
- Keep internal communications open – Making sure relevant functions inside the business know what’s going on can help to prevent confusion or clients getting mixed messages. For example, if the sales team finds out about a contractual dispute, they need to let credit management know before they start chasing for payment.
- Maintain thorough records – Taking notes and recording all communications can be useful if a contractual dispute arises. Analyzing data can also help you to track trends, and if there’s a problem that keeps coming up, you might need to make changes to your processes and procedures to prevent future issues.
- Get the right people involved – If a client tells you they have a contractual dispute, it’s probably not something that can be resolved by the credit management team alone. You’ll probably need to pass the issue on to someone else, but be sure to…
- Follow up – Even if the issue is no longer your concern, it’s still good to follow it up and make sure it’s resolved appropriately.
- Learn from the situation – Complaints of any kind can be uncomfortable and problematic, but they can also provide valuable opportunities to learn and improve. So don’t just forget about them and move on.
Find out more
If you’d like to learn more about how OnGuard credit management software can help you save time at work, please don’t hesitate to get in touch. Please get in touch on +31 (0)294 25 6666 or firstname.lastname@example.org. You can also keep up to date by following us on Twitter @OnGuardHQ.
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