Debtors

Katalyst manage debtors for many of our clients, we know a few rules that help maintain relationships and ensure payment.

• Be consistent - If you client says they will pay you on X date and they don’t, then call them, you need to teach them how to treat you and that you expect payment
• Don’t take it personally - The majority of  business people don’t plan to not pay you
• Don’t get in a fight - A bad client will use aggression to put you off and if they can get you into an argument, they have an excuse not to pay you, or so they think
• Don’t embarrass your debtors - If they are embarrased about not being able to pay, they may move their business somewhere else.  This means someone else is getting their sale and probably payment.  Consider if you want to maintain the relationship, they may be growing and are tight on funds, or waiting for financing.  Treat them with respect – they have friends, Auckland is small, word spreads.  You can work with them to reduce the debt, maybe pay a bit extra with each period till they are caught up
• Ask for a part payment - If there is a dispute, ask for a good faith part payment, then work on the issue to get the balance, you can even escalate to debt collectors for them to get the balance
• Final Notice - Whether using Debtor Daddy, as below, or making the call yourself, refer to the debt collector you use in the final notice.  This gets a better response that than just saying, “this will be passed on to debt collectors”.  Having the name, like “We use Waterstone Recovery’ shows that you are serious, you have used them before and have the system in place to escalate the debt promptly
• Escalate - If they don’t respect you, are aggressive or avoiding you, escalate to debt collectors as per your terms

Some Katalyst favourites for managing Debtors:

• Debtor Daddy - www.debtordaddy.com  Debtor Daddy is automated payment reminder emails, you can also throw some marketing messages on there, prompts for feedback, seasonal messagages etc.  More features like text reminders are coming soon, this is a great NZ company.  Debtor Daddy are Xero Network Partners, they link with your Xero so are set and forget
• Waterstone Recovery - www.waterstonerecovery.co.nz  We recommend Waterstone Recovery.  They work to maintain customer relationships, as we do, and only get the hammer out if they have to, but only if that is your preference.  For a free debt lodgement form, send me an email via our contact page

Give us a call if your debtors are out of control, need tidying up, or if you really can’t work out who owes you what.  Katalyst can step in to help with your debtors where required, or we can totally manage them for you, including phone calls and statements etc.

Call or email me if you want to discuss if Debtor Daddy suits your business, contact details for Waterstone, or if you would like to discuss how Katalyst can help you in your business.

From the other side, we handle creditor calls for some clients too.  I had a very irate guy call me today, he was threatening to remove some equipment from my clients, customers premises – so not cool at all.  I can tell you he won’t be getting any more work from my client.  His invoice had an incorrect GST rate on it so payment was delayed, then he had the nerve to threaten us.   A great example of exactly how not to treat your debtors.