Dealing with a non-responsive customer regarding an outstanding balance can be frustrating, especially if it’s impacting your cash flow or ability to operate. We’ve created a list of “best practices” to help you navigate situations when your customer has stopped responding.
Send Gentle Payment Reminders – and Start Early!
Whether you offer credit terms or not, starting early is an important piece of the puzzle if you want to get paid on time – or ever. Many businesses find success sending their customer an email notification letting them know that they will receive their bill in the coming days. This keeps you top of mind for your customer and if they’re having cash flow issues, it brings you to the front of the line to be paid.
Once you do submit your invoice for payment, a good general practice is to send the invoice at least twice per week. If more than two weeks have passed since the due date, add a phone call in week 3.
Be sure to keep the tone of all communications professional and non-emotional. If they’re having a hard time paying and they believe you’re now upset, they may feel the bridge with you is already burned and turn their focus to other vendors with whom they believe the relationship is salvageable.
Offer Flexible Payment Options
Understanding that financial situations vary, and cash flow constraints are often temporary, consider offering alternative solutions like an installment plan. This flexibility can encourage customers to settle their balances without feeling overwhelmed. If this works for them, they will greatly appreciate you working with them and will be eager to continue the relationship going forward.
Send a Formal Notice
If calls and emails go unanswered, you can try escalating to a formal notice. Draft a clear and concise letter outlining the amount due, the services or products provided, and the consequences of continued non-payment. If this also gets no response, you may be spinning your wheels to continue contacting them.
Partner with a Third-Party Billing / Collections Agency
When internal efforts fail, collaborating with a reputable service like Payment Resolution Partners (PRP) can be highly effective. When a customer becomes non-responsive, a third-party contacting them is often the only approach that will regain their attention. It’s important that this step be taken as soon as reasonably possible because as more time passes, they customer becomes more comfortable with not paying you. The best time to take this step is at 30 days past due and/or as soon as the customer stops responding.
PRP charges no upfront fees and collection is guaranteed, or our service is free.
To see rates now, visit our See Rates page.
Consider Legal Action
As a last resort, legal action may be necessary. This option is typically reserved for large past due amounts as the cost, time, and energy required to pursue this route can be extensive. Consult with a legal professional to understand your options, such as filing a claim in small claims court. This step should be taken after all other avenues have been completely exhausted.
Preventive Measures for the Future
To reduce the likelihood of ending up in this situation again:
• Establish Clear Payment Terms: Make sure your customers are clear on your payment expectations from the start. If you avoid highlighting payment terms because you’re trying to land the deal, this approach may come back to haunt you later on.
• Require Upfront Deposits: Collecting a portion of the payment before commencing work can safeguard your interests and minimize your risk. If possible, collecting a deposit when the order is placed and balance prior to delivery of goods or completion of services can be very effective.
• Maintain Open Communication: Regular check-ins and notifications can preempt potential payment issues.
If your payment reminders are getting ignored, escalate to a formal notice. Draft a clear and concise letter outlining the amount due, the services or products provided, and the consequences of continued non-payment. If your payment terms include a fee for late payment, remind them that this fee will apply if they don’t respond soon and that if they do reply, you can try to work with them to avoid the fee. This can often bring them back to the table as they want to avoid additional costs and it’s encouraging that you are open to working something out with them.
By implementing these strategies, you can navigate the complexities of non-responsive customers and foster healthier financial relationships.