Customer service

[murdock]

Customer service is only as good as the payment...you pay slow you get slow service...do you think this is the wrong approuch?

i can only offer and extremely efficient service to the customers who pay their bills on time...there is a chain reaction when payments are not made on time and until bad customers pay up it causes all sorts of issues and delays.

wholesalers and distributors use a discount structure for early payemnt...how do you are a service company manage bad or slow paying customers?

[Just Gone]

Customer service is only as good as the payment...you pay slow you get slow service...do think this is the wrong approuch?

I FULLY agree with this ............ there are too many people out there that forget this , that if and when they pay late and especially if you have to beg them to pay - they then expect you to drop everything and beetle off to their problem, because it is important to them. They forgot that paying for the service was also important to the guy that gave them the service in the first place !

[Ann.J]

Agreed. For this you must consider a couple of tips to ensure speeding up your collection process:

1. You should determine why the payments are coming in so late and try resolving.
you should discuss payment terms with client at time of making the deal with them.
2. Make the payment system easier for the clients
3. Review on your late paying customer's history and change your terms when you deal with them again in future, or avaiod them altogether.
4. Send them reminders to pay on time.
5. Keep a specific collection procedure and stick to it for all customers to avoid confusions

[Justloadit]

Why should you have all this work to get your money. The client did not have to do all this work when he called you to resolve his/her problem.

I no longer do work on account any more. I still do have a few clients on account, but I have no problems with them on the payment side.

[Dave A]

Customer service is only as good as the payment...you pay slow you get slow service...do you think this is the wrong approuch?

Yep - I reckon it's the wrong approach. I believe in giving the best service you can, or no service at all.

If we've already started with collection efforts, you're cut off from further service delivery until the account is paid up or you have made satisfactory payment arrangements with us. Sometimes that does mean going out to service and collect at the same time - but you get one chance to play that game if you don't pay as arranged.

I've also found that being quite clear on terms up front saves a lot of this bad /slow paying debt problem.

I'm sure it costs me clients at times, but I really don't think having my good clients subsidising my bad clients is good business.

ps. Nice post, Ann.

[AndyD]

I've learned the hard way many years ago and regularly dump the habitual bad payers. I'm in the fortunate position of not needing to advertise to be busy and one of the ways I can be good value for money is by not carrying bad payers at the expense of the good ones. I would rather let my business find a natural size than trying to grow it larger on the back of bad payers.

That said I treat all customers as energetically as any other .......up to the point they get the axe at least.

[Blurock]

I've also found that being quite clear on terms up front saves a lot of this bad /slow paying debt problem.

I'm sure it costs me clients at times, but I really don't think having my good clients subsidising my bad clients is good business.

Good posts so far. Bad clients can cost you money. Consider the 80/20 principle.

One has to be brutal at times. There is a fine line between wanting the sale and applying the rules. Make the rules clear to everyone, including your own staff and stick to it!

[IanF]

I just submitted a tender were one clause was the "may" pay within 30 days following the month of delivery, with loads of other conditions. I just said conditions are suited to contractors and not printing supply so not accepted. Lets see what happens. I delivered the tender yesterday and still got an order before I delivered it.
One thing that stood out was the procurement manager had no idea how costing in printing works or what is practical.

[Ann.J]

True. Agreed. For bad payers, A clear action plan should be set out and implemented. Avoid further dealings with them so that the backlog clears and they understand it pay off time or else no more business

[wynn]

I have mentioned http://www.getting-paid-system.com/ before

It is a system of sending out reminders by email at certain times of the month before payment is due then more stridently after payment is due, the principal of he who shouts loudest and most often is the first to be heard, seems logical.

[murdock]

i wish it was all that simple...i have a few customers who are slow payer...i wouldnt drop them if they paid me 3-4 months late for some invoices...then you ask why would i be so stupid...the answer is simple...remember i have been operating for over 20 years...some of my slow payers have supported my bussiness for over 15 years(unfortunatly none of my customers have been operating as long as i have)...from building their factories/offices...moving the factories/offices to new locations and general maintenance...when the invoices are large amount then i insist on prompt payment.

today was a good example of a customer who has become a slow payer...becuase of the drop in the economy the demand for their product have dropped...so they have retrenched 70 % of the staff...and are strapped for cash...they call me out today...konowing i am gona battle to get my money on time...i go and service the customer...and you ask why...well when the going was good they supported my company and i made some good money out of them...i dont believe in kicking a person while they are down...in fact even if i have to do a few freebies while they are down...i will try and assist....this doesnt apply to all my customers.

[Citizen X]

"Credit is like black magic, the customer and the money dissapear!"

[Onetwo]

I have mentioned http://www.getting-paid-system.com/ before

It is a system of sending out reminders by email at certain times of the month before payment is due then more stridently after payment is due, the principal of he who shouts loudest and most often is the first to be heard, seems logical.

Fully agree.

[Blurock]

...konowing i am gona battle to get my money on time...i go and service the customer...and you ask why...well when the going was good they supported my company and i made some good money out of them...i dont believe in kicking a person while they are down...in fact even if i have to do a few freebies while they are down...i will try and assist....this doesnt apply to all my customers.

@Murdock, you have obviously built a relationship with your customers. You know who you can trust and who not. Although a potentially slow payer, at least you know you will be paid. Its important to understand your customer and his business.

This leads me to an important business principle;
Business rule # 3: Look after your suppliers. Pay them on time. You never know when you may need them.

Business Rule # 112: Loyalty pays.

It is the new and infrequent customers that you have to watch out for. The ones who have exhausted their credit at other suppliers and now want to take you for a ride...

[wynn]

A customer sent an order to a distributor for a large amount of goods totaling a great deal of money.

The distributor noticed that the previous bill hadn't been paid. The collections manager left a voice-mail for them saying, "We can't ship your new order until you pay for the last one."

The next day the collections manager received a collect phone call, "Please cancel the order. We can't wait that long."