With fewer working days, inevitable winter illness and the end-of-year rush causing changing priorities, December can be a particularly challenging month for debt collection. It’s important to put extra effort into credit control and do your best to end the year on a positive financial note. That being said, your business could also be facing its own seasonal pressures and finding time to chase overdue debts effectively could be difficult.
We’ve put together a few simple tips to help.
Communicate with debtors
It’s important to reach out to your customers, remind them of your payment terms and make them aware of any changes in your operating hours or billing processes during the festive season.
Maybe you’re visiting customers to wish them the compliments of the season and thank them for their business during the year. This can be a good opportunity to tactfully remind them about any outstanding invoices, or check their credit position before dropping by.
Think ahead
Unfortunately, public holidays always give unscrupulous debtors an excuse to delay payment. And with the clock ticking down to the Christmas break, you need to be proactive.
Follow up as early as possible on overdue debts and debts that are becoming due. That way you’ll have a better chance of contacting the right person. You’ll also get in before people’s minds are too distracted by the festive rush or they start winding down for the holidays.
For sole traders or small businesses, there could be a temptation to put off settling debts to prioritise having available cash for the festivities, a skiing trip or the deposit on a summer holiday. Being proactive with credit control means you should be able to identify any debtors who are exhibiting signs of financial stress.
Don’t be too much of a Grinch
Overdue debt can be very frustrating. However, it’s important to remember that the festive season can be a challenging time for many businesses, with Christmas shutdowns and skeleton staff teams, they themselves may be struggling to get paid by their customers or experiencing a seasonal downturn in sales.
You need to be firm and persistent without entirely losing the festive spirit. The debtor may be a good customer who is simply experiencing temporary financial difficulties, so a ‘bah humbug’ approach could detract from an otherwise good trading relationship. You could consider offering special terms for settlement of the debt, such as instalment payments. That way, you could receive at least some of what you’re owed before the holiday makes debt collection more difficult.
Act fast
Is one of your debts at risk of not paying? Don’t let seasonal pressures and commitments distract you from taking any necessary action. Waiting could mean that the debtor’s finances deteriorate further – leaving you at the end of a long queue of other creditors.
Reliable debt collection support
If you’re still struggling to make robust credit control part of your pre-Christmas planning, it could be time to bring in a professional debt collection agency.
Whether it’s during the festive season or at any other time of year, at Redwood Collections we can help you achieve positive debt collection outcomes. Our highly professional team have a strong track record of success, operating with diligence, integrity and sensitivity to protect your reputation and your customer relationships. By supporting you in dealing with overdue debt effectively, we can help your business Grow Stronger.
