Minimising Sales Rep Involvement Within the Collections Process

Chasing customers for payment can create stress and a heavy workload for everyone involved. Receivables remain the lifeblood for most companies, so ideally, this critical collection function is as efficient and systematic as possible. As a sales leader for over 20 years, I can tell you that it becomes especially painful when your sales team is required to step in and help out because:

  • Reps get pulled away from their sales activities to make collections calls, and that time could have been spent bringing in new accounts that pay their bills on time. 
  • Reps have to find a way to not burn any customer bridges while still conveying the urgency of paying up.

As a sales leader, you might feel the collections process has little to do with your sales team — not so. Sales, especially in B2B, is all about relationship building. Nothing can cause a tear in a carefully created relationship like a collection call demanding money, especially from a customer who has already paid and the cash hasn’t been applied correctly yet, or are still withholding payment because the invoice is incorrect. For many organisations, the sale hasn’t really been made until payment is received. No payment means no sale, which means no commission or recognition for the salesperson’s effort that went into closing the deal.

Here are four options sales leaders can suggest to credit and finance teams to help prevent delinquent accounts and minimise the amount of time sales reps are required to assist with collections:

  1. If your company requires credit checks before bringing new customers on board, have your sales reps send a link to an online credit application. Make it easy for the customer to complete the application and provide supporting documentation to your Finance Department, and don’t wait until after the sale — the credit-approval and onboarding process can slow down customer momentum. Investigate credit automation for ongoing customer credit checks to determine if a customer qualifies for an increase in available credit, or if accounting needs to be more proactive and set up a payment plan.
  2. Suggest to your controller that automated payment reminders be sent out to customers. On average, customers pay three times faster when they’re reminded to do so. If this cannot be easily set up in your ERP, there are low-cost options for this.
  3. Ask your Finance or Treasury Department if they will consider accepting credit card as a payment method, if not currently accepted. The more payment methods offered, the easier you are to do business with. If the concern is paying the merchant processing fees, an option is to pass a surcharge or convenience fee to the customer at time of payment for the option of utilising credit card.
  4. If you’re working within tight margins or will have a lot of upfront costs to get a customer’s service started, have the ability to easily accept online payment and get a deposit up front. Having an easy means to accept a deposit means your company can start fulfilling the order faster. The same payment portal offering should have ability to easily set up payment plans and auto-payment for your customers.

There are multiple reasons why a customer might be late on payment, but if your AR team is putting precautions in place, such as sending an online credit application and automating ongoing credit reviews, sending automatic payment reminders, providing an online payment portal to accept pre-payment, and accept additional methods of payment, your finance team can ensure more of your customers pay on time and reduce the amount of interaction sales reps will need to have with delinquent accounts.

Written by- Diana Eagen

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