Because the reasons behind the problem are different from customer to customer, it can be tough to know when it’s best to accept the request for a payment plan. So, how do you determine if that’s the best course of action? Your answer lies in two phases:
Phase one: Understand the story.
Call your customer and initiate the conversation. Set aside enough time to really listen. Get the full version, don’t rush it and let your customer do the majority of the talking. What they tell you can help you determine if this is an isolated incident or if the issues are much more serious. Take notes and clarify any parts that are unclear before you end the conversation.
Phase two: Validate the story.
Once you feel satisfied that you have details you need to move forward, it’s time to validate your customer’s story. Start first by talking to other creditors. Is the story consistent?
From there, talk to your customer’s bank. If it’s a small bank or if it happens to be the same one that you use, you might be able to verify over the phone whether or not a check would clear if your customer issued you one.
Lastly, get your customer’s last 6 months worth of Merchant Statements. This will tell you how much money is acquired through his or her monthly credit card sales. This, by the way, is a great bit of information to get when you first begin doing business with a new customer. It will give you a view of the sales they have through credit cards and if there’s been a downward trend.
The knowledge you gain through these two phases will help you determine if the cash flow claim is valid and if it is, which payment plan is the best option for you.