Excuse or Explanation? How to Get Your Money!

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Dean Kaplan

We’ve all heard hundreds of different stories as to why a business debt has not been paid.  For our commercial collection agency, the first thing our debt collectors are trained to do is to figure out if it is a legitimate explanation or simply an excuse.  The answer influences how we proceed in order to get the delinquent invoices paid as soon as possible.

One of the biggest challenges for collectors is to keep your eyes from rolling back into your head when hearing a common excuse for the thousandth time:  “The check is in the mail;” “We only print checks twice a month;” “I don’t show that invoice in our system;” “The person who signs the checks is out of town;” “I need proof of delivery before it can be approved.”  Whatever the story, the collector needs to stay focused and first separate fact from fiction.

You’re not going to make much progress if you respond to these excuses as if they were legitimate explanations.  The debtor typically will stay with that excuse for as long as you let them and then try switching to a new excuse.  The collector gets the runaround and the debtor learns that this is an obligation they can probably keep pushing out before paying.

Therefore, the first order of business is to determine if the story is legitimate or a smoke screen.  The only way to do this is to learn more.  And the key is to learn more before pivoting to your real goal: collecting the money.

A primary technique promoted in sales training classes is to always frame questions so the answer will be “Yes.”  Sales people are trying to get customers to buy, and studies show that if customers keep “agreeing” with the sales person, the rate of sales is higher.  The same philosophy extends to debt collectors.  We try to frame responses to avoid the answer being “No” by initially asking positive, somewhat open-ended questions.

Our collectors typically respond to a story with an agreeing comment that ends in a question where we expect an affirmative response to keep the conversation positive:

  • The checks in the mail
    • Great!  What date do you show the check was printed?
    • What is the typical process from printing to signing to mailing?
    • Based on that description, we should already have received the check -how do we figure out if this check is stuck somewhere inside your company or in the mail?
    • Can you tell me the check #, amount, and which invoices it paid?
  • The person who signs the checks is out of town
    • Wow, you must be getting a lot of calls from vendors if you aren’t able to send out payments.
    • Is this a common occurrence or a one-time circumstance?
    • How are you guys getting along with this person being gone right now (or ‘gone so much’)?
    • Good thing your payroll is set up to function without that person being around to sign paychecks.
    • Can you tell me what invoices you show in your system?
    • Are they all approved to be paid?  What else needs to be done to make sure they are approved for payment?
    • When does the system show they should be paid?
    • When is the person coming back to the office?  Why are they gone?  Is there any chance they will be gone longer?  What is going to happen if they are gone longer?
    • How long will it take once the person returns to get the checks printed, signed and mailed?
    • In your experience, is there any reason this won’t get taken care of according to that process when the person returns?

While the natural response to a story is to ask the specific question we are most interested in (e.g. what is the check number, amount, and date mailed; when will the person be back and sign the check) we ask a number of other questions first to get the conversation flowing, empathize with the individual, and build some rapport.  During this process, we begin to compile information to help us judge whether this is a legitimate explanation or simply an excuse.

If it seems like an excuse, then we keep probing until we finally get to the point where we can say “I’m sorry, but this doesn’t really add up for me” and explain why.  At that point we then continue the conversation to get more information and get to the real explanation as to why the invoices haven’t been paid.  Throughout this process, we are trying to avoid confrontation that can cause defensiveness, avoidance, or non-cooperation.  Any good salesman will tell you it is almost impossible to get the sale if this happens.

Of course, whether the initial story was legitimate or we eventually ferret out the real explanation, we still don’t have the money.  We need to figure out how to get paid, but at least we now are dealing with the real issues and can tailor the collection technique for these circumstances in order to maximize the likelihood of success.

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Posted in Collection Software, Commercial Debt Collection, Debt Collection, Large Claim Collection Experts, Opinion .

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