Giving Credit means different things to different people.
Of course, in a business sense, its most common usage is to extend terms of payment.
Yet there is a way of giving credit AND cutting down on the amount of money people owe you - a way that can cut down your “debtors column” dramatically.
It's very simple and very effective. Yet most people don't do it.
Imagine I'm a customer of yours. Imagine too that I run an account with you. I receive your statement at the end of the month. And then, surprise surprise, I do the right thing and I pay you on time.
What's your response to that? Well, unfortunately, if you're like most businesses, the answer is NOTHING.
Contrast that with this - imagine I don't pay my account - what happens then. Well again, if you're like most companies a lot of activity happens. I get letters and phone calls asking, indeed demanding, that I pay forthwith.
Think about the contrasts. When I do the right thing and pay the bill, nothing happens. Yet when I don't pay, all hell breaks loose.
There has to be a better way, don't you think.
Wouldn't it be so much smarter if I got the note or call from you when I paid you on time. Just a small note that says, “Thank you. We really appreciate customers like you who pay their accounts on time. It makes it so much easier for us to continue giving you the top class service you deserve. Keep up the good work.”
Let's face it, the contact that most customers have with most Accounting Departments is negative. Thanking people for doing the right thing changes that and lets your accounting people see themselves as playing a valuable part in the process of creating and maintaining customers. And after all - everyone in your business is a salesperson aren't they?
So go on, institute a programme of thanking people for paying. One client who's been doing that for quite a while now tells me that in 51 per cent of the cases when she sends the “thank you for paying letter” customers actually call her and say how thrilled they were to get the note. And what do you think that says about improving customer loyalty.
Again, let's face it, the only cost in doing something like this is the cost of a stamp. We're happy to pay that cost when people do the wrong thing. Isn't it about time we were happy to do it when they do the right thing.
As specialists in business development too, we can help you build yourself a better business. So give us a call. We can start off simply with a planning session before deciding to go on. That way you are under no pressure, and the choice to go forward is totally under your control. And remember what we said about our guarantee.
