Debt Collection Techniques:
Getting People to Pay

When we started our company, it was a tiny operation out of an apartment. We paid our suppliers, our customers paid us, and we paid ourselves – perfect.

However, when we expanded, we started running into trouble. Sometimes customers couldn’t, or didn’t, pay; that was the money we needed to pay ourselves and stay afloat. We quickly learned the debt collection techniques that didn’t work: ignoring the problem, threatening letters, and allowing them to walk all over us.

Maybe we could have contracted our debt collection out, and maybe we could have involved the legal system, but we didn’t. Perhaps an unconventional approach, we decided instead to talk with our customers.

Why couldn’t they pay now? How could we work out payment? People are scared of being in debt, of owing money to others. They don’t want that. So we offered an easy solution of low payment plans. Our customers didn’t want to be branded as bad people, and they weren’t. With low payments for them, interest on their debt for us, we were able to fix the situation for everyone involved.