How to maintain good customer relations while claiming payment of your invoices?

For any business, good customer relations and positive cash flow are crucial. Therefore, finding yourself sitting on a pile of unpaid bills can seem like a dead end.

On the other hand, for your customer, a bad billing experience can damage confidence in your company. Such tension is detrimental to successful relations between the two parties, posing a threat to the entire business relationship.

So what can you do when faced with the difficult situation of choosing between maintaining the customer relationship and getting an invoice paid?

What are the reasons why customers delay making their payments?

In the majority of cases, late payments are the result of cash flow problems with your customers. They feel something akin to shame. They fear their cash flow problems will become public knowledge. So, they bury their heads in the sand and don't respond to their suppliers' recalls.

It's also possible that your customer doesn't want to pay due to an order or delivery dispute – wrong merchandise or quality issues, for example.

If you put too much pressure on a customer to get an invoice paid, it could lead to a clash. Every business needs to collect unpaid invoices to smooth its own cash flow, but no one likes being put under pressure. Additionally, threatening a client with legal action is not healthy for the long-term future of a relationship.

On the other hand, playing on an emotional connection is not a guarantee. Supplier and customer often know each other, which can lead the first to tacitly grant longer payment terms to the second. The customer can then take advantage of this confidence to favor payment from other suppliers.
Some customers switch providers as soon as they feel unappreciated, find the company's representatives unhelpful, or experience other service-related issues.

Lack of communication between customer and supplier is the cause of tensions around payments and unpaid invoices.

How to follow up on unpaid invoices and send your reminders?

Firstly, it is essential to invoice as early as possible and ensure that your client receives your invoices. Check the accuracy of your invoices as well as your customers' contact details. Keep in your files any signed document, receipt, validation, etc. This can always be useful to you later.

Check your invoice due dates regularly. For certain clients that you know are regularly late, send a short text or email as the due date approaches, rather than waiting until it is also late. When due, if you still have not received your payment, send a simple and courteous reminder to your customer.

If you have granted a payment deadline or a clearance plan, make sure that your customers/debtors respect their commitments. Otherwise, send them a payment reminder right away.

In your reminder letter, be sure to include the following:

• contact details of both companies
• date of your recall
• billing contact person in your company
• information on the invoice due (number, details, possible copy)
• amount due (principal and possible costs, to be justified with your general conditions)
• reminder of your payment terms and consequences in the event of delay
• reminder due date and payment reference

There are automation or IT solutions for tracking your invoices, payments and reminders. The free MindYourBills app, for example, allows you to easily enter your invoices into the app, notifies you when an invoice is due, offers you an automated reminder and follow-up in the event of unpaid invoices.

If invoices remain unpaid after your reminders, turn to an intermediary. The intermediary has no emotional ties. As its name suggests, it is located between the two speakers. It helps you recover what you owe while considering the debtor as his customer's customer. He listens to your client and must be open to finding an amicable solution as quickly as possible. Amicable negotiation is always preferable to recover your unpaid invoices while maintaining a commercial relationship.

The ability to listen and build trust facilitates dialogue with your customer who is in arrears. Collection companies have every interest in finding payment solutions while maintaining customer relations and your brand image.

There is no magic formula for negotiating the perfect payment terms. Behind the technical and financial aspects of negotiating payment terms lies a commercial strategy. You must maintain good customer relations and ease tensions to prevent late payments from turning into unpaid debts. But when you are still not paid when your reminder is due, it is time to entrust the negotiation of your due to a trusted intermediary, such as INTERNATIONAL RECOVER COMPANY® .