So, nothing new, customers use stall tactics to delay payment. There I said it and the first step in fixing a problem is admitting you have one. Now that we’ve admitted it, we need to understand how we can push back.  There are two essential areas here that need to be addressed.  First it’s about education and recognizing the behavior. The second area is really how process and technology can help support the correction.

It is the responsibility of the assigned collector to recognize a stall tactic.  Not to use a cliché, but the squeaky wheel in the case of collections, does get the grease. Customers have a keen insight into your business and use it to their advantage.  They realize if they aren’t getting any calls or communications about their payment behavior, they will continue to push the envelope until they treat you a finance company.

What should you look out for? Customers fall into three main categories or stalling or delaying payment.  They are listed below:

  • The Requester- One of the prime stall tactics is the invoice copy/statement of account. This is a quick way for the customer to put the work back on their vendor to supply further documentation above what was already supplied.   Copies of contracts and purchase orders also fall into this category. 
  • The Disputer- Monitoring the customer dispute behaviors is essential. Watch for the pattern and repeated disputes.
  • The Withholder- They love to hold something back. Short pay the invoice today, get some extra attention and low and behold the customer just bought themselves another 120 days.

In all of the above cases, the customer knows how you operate. They know how long it takes to receive a call from you. They know when you miss a short pay or worse, issue a credit on a completely false claim. 
Strong AR technology should not only support the collection process, but it should be able to monitor the behavioral tendencies. By tracking and maintaining a database of common and frequent disputes by customer, the system should be prompting your collection team to focus on those customers displaying specific types of behavior.  The system should be offering multiple delivery options for invoices and statements of account. Finally, the system should be using these behaviors to monitor credit risk and prompt the business to take action before it’s too late.

Each year, customers find new ways to work the system and being cognizant of these types of behaviors is a part of a collector’s job description.  Being current and timely with follow up is an essential.  Good AR technology should be able to support the experienced collector and help mitigate risk by closely monitoring the customer’s credit limit.  Ultimately, management should be focused on setting clear expectations and ensure that their team is performing to optimal standards. So what are we waiting for? It’s time to take back control and stop being a victim of the habitual late payer.