Should Sales Act as Collections When a Client's Account is Overdue?

In my eyes I can agree with most in the aspects of selling and that's the bottom line of a sales person is to drive revenue. I worked for a distribution company for many years as a General Manager. The whole analogy to the business as our President derived in his quote was "We're all in Sales", so that being said even collections is in sales. So to make the blow much easier on everyone even AR needs to come across empathetic. We all have tough times in business. This month better than last and vice-verse. Owners of businesses know they have to pay their debts. Whether you're in accounts receivable or sales we're all in collections also.

Who has the best relationship with your client than your sales people? Heck many eat with them, play golf with them, many times have invites over to BBQ with them and so on. The relationship is in some cases better than family. A Salesperson should soften the conversation my probing with open ended questions like asking them to check, and ensure it wasn't a mistake on the salesperson's part and/or could it have gotten lost or misfiled, doesn't make the sales person a bad guy/gal. It simply states we do work for a company and we all have to mind our business.

Our credit department did do their job, but in many cases the customer/client did go to the extreme until confronted. AR did call them, did follow up with them with letters and 10 day notices from the legal department, but when the customer is having a hard time they may not even answer the phone in fear of collections. So, to make it a softer blow, AR would ask us (management of the center) who also was in sales as well as operations to talk to our clients and see what we can do to assist. Surely we didn't want to lose the client over one invoice or several, but a plan of action could be made to help them out. So we would speak to the client, maybe take them to lunch and sure discuss all the things happening in their business and what's going on for the future etc., etc. But again we softened the blow because the client trusted us and knew we would work with them in every avenue possible. We became the voice between the client and corporate. Face it clients hate corporate who places demands, so they knew we understood their business and we brought back their issues to AR and AR was able to make arrangements or change the terms to their accounts, hence making the client happier, and in many cases increasing business because they realized under a collaborative effort the company wasn't out to sink the client but only help them grow which was beneficial to both sides.

Of course you did have those clients that pushed the limits and you had no choice but to become forceful with demand letters and even issue leans, but take into account, dependent on how big the client is $1000.00 invoice worth going after if the client buys $50MM annually? When taking them to court is going to cost you more time, effort and expenses? So you have to weigh each client individually and know your client to be able to even approach them in the manner of collections. I succeeded. I knew my clients and never had a loss show up on my monthly’s that will be wrote off due to the inability to collect. Guess it depends on the business, the product, the efforts involved, the type of sales person you have and how they are at sales and negotiation tactics and their relationship with their clients. If you’re servicing them, they are happy with the product, the service, the pricing, they know deep inside that if they’ve been avoiding payment someone, even the sales person could easily ask; “hey what’s going on, how can I/we help”?

And in many cases sometimes that is all it takes is the buddy plan. "I (the client) couldn't call corporate, but I knew you could help me (the salesperson) with a possible plan of action. And who knows this same, I scratch your back and assist, gives you the opportunity for more sales!

I've been gone for a while...but

To everyone who has come and read and kept up with my blog, I apologize but I have been away for at least 7 months. But not to fear, I am hoping to start writing again since it is essential to what I enjoy doing. So, without further ado let's get started and thanks to all who visit and read and keep up.