Following-Up on a Set Schedule Lowers Average Days to Pay by 30 to 60 Days

Everyone has "that vendor". You know, the one that will, without fail, call you if your payment is even one day late. They may be the nicest person in the world, but you know without a doubt that they will call. Every. Single. Time. That's the vendor that will eventually work their way to the top of the payment list. You want to be that vendor.

Maybe It Doesn't Matter?

Conversely, by not following up consistently, what you're really teaching customers that it's no big deal to be a little late every month. You're teaching them that there are no consequences. Bottom line: If you don't follow up on time, you are unlikely to get paid on time consistently.

Set Schedule

But it's not just immediacy that matters. Studies have shown that following up at random is not nearly as effective as following up on a set schedule. Here's an example:

Company A doesn't have a set schedule. No one is really dedicated to invoice follow-up and invoices get called on when someone gets around to it (or when the boss calls and complains!). They might follow up on an invoice twice at 30 days, then wait a couple of weeks and to follow up again and then wait another week and send three really urgent messages. That's 6 messages in 45 days.

Company B has a plan. They have a dedicated resource whose job it is to follow up on all invoices on a set schedule. Company B knows which customers are new and which existing customers have difficulty receiving and routing invoices. Those customers may get a call before the invoice is due to make sure it arrived and is payable. The day that invoice becomes past due, Company B follows up. They investigate the reason for the late payment, resolve any issues and then ask when the invoice is likely to be paid. They promise to follow up on that day to get a check number for their records. Then they actually follow up on that day to get a check number. 

On average, Company B will get paid 30 days faster with 2 fewer touches than Company A.

Results

And it makes sense, right? If you set expectations with the client and then consistently follow up on what you said you were going to do--especially if you do so politely and with a customer-service-oriented attitude--they are going to get the message.

The results are stunning. We’ve seen average days to pay drop by 30 to 60 days just by following up on a set schedule. And we’ve seen the number of write-offs drop up to 90 percent.

Now, go get your money.

 Following-Up on a Set Schedule Lowers Average Days to Pay by 30 to 60 Days

Following-Up on a Set Schedule Lowers Average Days to Pay by 30 to 60 Days