Debt Collection Techniques:
Small Business Collections

In these tough economic times, the small businesses have been hit especially hard. They face not only fewer customers generating income but also suppliers with an active collections program to ensure they get paid. This can leave many small companies in a bind when it comes to collecting their own debts. We have found a few rules that work for us.

1. Contact is not harassment. Stay in touch with those outstanding invoices. Sometimes it truly is the "squeaky wheel that gets the grease."

2. Empathize and relate. Understand where they are financially and let them know you understand. Take the time to develop a more personal relationship with them. You'll find that they are less likely to blow you off if they feel some sort of friendship towards you.

3. Be prepared to lose some of your money. Fact- some just won't be able to pay...ever. If you feel that an invoice is going south, offer a 20% discount to settle the bill.

There are no hard and fast rules to success but these are a couple of tips and techniques that we've found that work in collections with our small business.