The Best Collectors Know: the Debtor is a Customer

“Collections is a sales job,” said Manuela Hensman, senior vice president of collections for Aspect Software’s PerformanceEdge Group. “Sales capabilities apply.”

Hensman, who’s spent 20 years in the collections industry, discussed the factors involved in good collections calls and the skills of good collections agents in an exclusive interview with insideARM.com.

A successful collections call involves three basic factors—pre-call planning, the call itself and post-call follow-up, according to Hensman.

The first, and one of the most important, elements of pre-call planning is to double check that the agency’s records on the debtor are correct, look over the consumer’s past payment record and what steps the agency has taken to collect the current debt, and ascertain the right person to talk to. The agent should start thinking through a payment plan for the debtor as well.

In addition, the agent should be formulating fact-finding questions and an opening statement that includes the identity of the agent, the firm and the reason for the call. Finally, don’t forget the strategic pause.

Why a pause? Because it gives the consumer time to talk, explained Hensman. Some will open up with all kinds of information, enabling the agent to recognize potential solutions in order to get a payment – preferably the full amount. Failing that, the agent can use the information to possibly work out a payment plan.

To overcome any objections to payment, Hensman recommends drilling down to determine what exactly the debtor is objecting to, which may not be the first reason the customer gives. For example, he may say he doesn’t have the money, so the agent must find out when he will have the money, which may be as soon as the next paycheck.

During the call itself, it’s critical to listen and to take accurate notes, Hensman said. “Be encouraging. Show the customer that you are paying attention.”

Agents need to create rapport and be empathetic, Hensman said. Therefore, some of the best agents are the ones who’ve been through collections themselves. This helps them relate to the consumer’s issues, giving them a common ground from which to negotiate compromise settlements.

Beyond being empathetic, good agents have good listening, problem-solving and negotiation skills, are detail-oriented and have a positive attitude, Hensman said. While being empathetic, good collection agents also need to be authoritative.

Follow-through is important at the end of and after the call, Hensman said. After thanking the consumer, the agent needs to document everything, such as payment commitments and actions to take if commitments weren’t made. The agent also must advise other departments of the results of the call and schedule follow-up actions and dates.

Hensman noted it’s important to take a sales approach rather than a “customer as deadbeat” approach because companies don’t want to alienate customers. “It’s much more expensive to acquire a new customer than to re-sell a current customer.”

Hensman gave the example of a jeweler who encourages delinquent customers to come into the store to make a payment – even a partial one – because the customers are likely to make additional purchases while there.