Tips for Winning on the Telephone

When invoices and letters to debtors go unanswered, it’s time to turn to the telephone for your collection efforts. As a collection tool, the telephone rates as one of the best since it offers convenient, timely, and cost-effective, two-way communication.

To win on the telephone, it’s essential that you be prepared since many debtors can more than hold their own on the phone. Why? Consider that the debtor who owes you, probably owes others. And if you are calling, other creditors are also calling…and possibly have been for months. Therefore, you may be speaking with a debtor who is skilled in stall tactics and excuses that have worked in the past.

Prepare for the Call
Pre-call planning consists of changing your attitude and following four steps before each call.

A New Attitude – Your debtor received a service and is the better for it. And as the provider, you deserve to be paid. Remember, the first call is not your first contact. The debtor has had many chances to pay: at time of service, at first invoice, and at reminder notices.

Four Steps for Success

1. Gather Facts – Know exactly how much is owed, for what, and for how long. Stating facts, dates, and exact numbers establishes credibility and intimidates debtors…making them less likely to argue.

2. Review History – Has the debtor owed you before? What were their objections? Have precedents been set by previous deals? A thorough review helps you uncover potential problems or opportunities for holding debtors to their promises.

3. Decide in Advance – Are you willing to accept less than full payment? How much less, and under what conditions? Experienced debtors try to make deals. Any hesitation on your part during the negotiations can weaken your position and put the debtor in control.

4. Put Time on Your Side – The best chance to catch a debtor at home is 4:00 to 8:00 p.m., Sunday through Friday. On Saturdays, try between 8:00 and 10:00 a.m. Before calling a debtor, make sure you fully understand your state regulations regarding allowable calling times.

Phone Skills: Be Better Than the Debtor
To make the most of your call, follow these tips:
1. Confirm that you are speaking to the correct person at the correct address. If anyone else answers, do not share the purpose of the call with them and ask to speak to the proper person.
2. Identify yourself to the debtor by giving your name, title, and the name of your business.
3. Ask for payment in full! Example: “Mr. Debtor, your account with us is seriously overdue. Will you mail your $500 check today, or will you drive by our office with your check today?”
4. Wait for the debtor’s response. Up to this point, you’ve done all the talking. A timely pause puts the burden on the debtor. The longer the silence lasts, the more pressure builds on the debtor. Do not break the silence!
5. Listen to the debtor and note any clues to help you obtain payment in full. Figure out a way to motivate the debtor.
6. Find the solution by asking questions and using information provided by the debtor. Maintain credibility by using the facts you gathered for your pre-call plan.
7. Close the deal! Be sure that you and the debtor agree on a method and date of payment. Ask the debtor to write down your name, address, phone number, and what he/she has promised to do. Make a note of your conversation and put it with the debtor’s records.

“Prizes” for Non-Payment
If your debtor says he/she won’t pay, you need to adopt a new strategy. For starters, don’t argue with them. Let them think they have won. Then, list off their “prizes” -- interest charges, no future services, forwarding of the account to a collection agency, reporting to a credit bureau, etc. Offer them the opportunity to forgo such prizes by ensuring their payment is received within 10 days.

Debtors sometimes make payment decisions after hanging up. So, there is a chance you could still receive payment. But if you don’t receive payment, then it’s time to forward the account to a professional collection agency.

Copyright © 2005 I.C. System. All rights reserved.

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