Every business relies on its customers to pay for the goods and services it provides on time to maintain operations and ensure profitability. However, collecting those funds often requires maintaining a delicate balance. Acting too aggressively could damage the relationships your business needs, while being too lenient might mean customers never pay their debts. The debt collection tips below will help you close outstanding accounts while preserving relationships with your existing customers.

3 Debt Collection Tips for Businesses

1. Avoid Getting Emotional

Many small business owners often get angry when customers don’t pay their debts, especially when you’ve cultivated a long-term relationship. However, getting angry in phone conversations or sending threatening letters will likely push the customer away and decrease your chances of ever collecting on the debt. As with any business practice, it’s always best to stay calm, listen to the customer’s explanation, and try to come to a practical solution.

2. Be Willing to Work With Customers

While some debtors simply refuse to pay what they owe, most delinquencies are caused by temporary financial difficulties or other unique situations. If the client wants to pay their debt and preserve the relationship, offering to settle for less or develop a payment plan is sometimes the best approach.

3. Understand the Law

Federal law strictly limits the type of debt collection practices that businesses can use, and your state government may have additional requirements that must be met. Understanding the law before you try to collect an outstanding debt will help you avoid unintentionally harassing a client or incurring serious fines from the Federal Trade Commission.

Hiring a third-party debt collection company will maximize your returns without the friction that often damages otherwise fruitful relationships. Luke A. Weiland, Attorney at Law, has an excellent reputation with businesses throughout the Wisconsin Rapids, WI, area, providing dependable results and professional, courteous service. Visit their website to learn more about their debt collection services, follow their Twitter page for more legal tips and insight, or call (715) 422-6808 to discuss your needs and schedule a consultation.