Great Customer – Bad Debt

14 Aug

Your customer is GREAT! But his debt? Not so much

Past due bill, C2C ResourcesWhat do you do when one of your best customers simply won’t pay a bill?

We learned of a recent scenario where a truly solid customer refused to pay saying that he had to hire someone to “re-do” the services provided.

In this case, the customer had a positive payment history, having always paid his bills on time. He’d never lodged a complaint before and in fact, had even provided referrals on several occasions.

In this case, he didn’t properly dispute the invoice of $1,500 by calling his service provider before the invoice hit his mailbox. Instead, he just didn’t pay the bill. Only when approached about the past due invoice did he verbalize his dissatisfaction.

So, what needs to happen in a case like that?

On the surface, it doesn’t appear that the customer is trying to get a freebie or rip off his service provider. Sure, he should have voiced his complaint right away, but his history of good credit and referrals would suggest that the above situation is unusual for him.

Before any action is taken, a series of questions needs to be asked and answered on the part of the service provider:

1. How long has he been servicing this customer?

2. Has his customer ever missed a payment before?

3. How much money is involved?

4. How much might the relationship be worth in future sales?

5. How likely is the customer to continue making referrals?

6. Does the customer have a valid complaint?

The ultimate question is this: Is losing the $1,500 worth it to save the relationship?

Keeping a quality customer may well be worth a $1,500 loss. Do the investigation into the case to find out what happened. Not only do you need to confirm the legitimacy of his complaint, but if it is legit, you need to make sure the mistake never happens again.

After your investigation, there’s certainly the chance that your customer’s viewpoint won’t match your own. A job well done can be subjective. Even if you feel he’s dead wrong in his conclusion about the work you provided, you still must answer the ultimate question: is it worth losing him over it?

If you conclude that it’s worth every penny to save the relationship, then consider the debt forgiven. Go the extra mile if you can afford to do so to offer a future service at a one-time discounted rate.

Keeping your eye on the long-term, big picture will help you focus on the right target: long-term GREAT customers.


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