# Credit Control Dept: How many calls per week before Harassment.



## Kluivert (16 Dec 2010)

Hi there, 

As a Credit Control I wanted to gauge what business owners would see as acceptable number of times per week to contact customers regarding overdue accounts. 

My current approach is: 

30 days + : Contact once per week. 
60 days + : Contact once/twice per week. 
90 days + : Contact twice per week. 
120 days+ : Contact three times per week. 

As a qualified accountant, I am friendly, professional and polite to all customers, even when they shout abuse at me, and I always try to make payment plans with customers. 

90% of customers appreciate these approach and work with it very well. However there is 10% who will use any excuse under the sun to avoid me. Latest one is harassment. This would mainly apply to those with 90/120 days + balances. 

I think my approach is correct and just wondering what other business owners would think of the call policy. 

Thanks


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## callybags (16 Dec 2010)

I havr found from expierience that it is very difficult to get one rule that fits all.

Our customer base is varied between small sole traders and large multi-nationals with everything in between.

Over a period of time I have built up a pattern with each customer and chase money based on this.

The approaches include

Regular phone calls (at least one a week)
Emails (where the customer might try and deny any contact)
Making contact with the person who orders to let them know there may be a problem with supplies ( this I find gets a quick response)
Asking our sales rep to have a word with his contact.

None of it is perfect and we have certain customers who just have serious cash flow problems and won't pay until they can. With these we try to minimise our exposure in case of them going bust.


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## Kluivert (16 Dec 2010)

callybags said:


> The approaches include
> 
> 
> Making contact with the person who orders to let them know there may be a problem with supplies ( this I find gets a quick response)
> Asking our sales rep to have a word with his contact.


 
1. Some smaller/medium sized business, the owners do not like accounts talking to sales/buying person regarding accounts. Industry thing which I dont buy into. 
2. Some Reps are very good at making a call and collecting a cheque, some Reps just behind over backwards to please customers and thus dont talk to them about accounts. 

One call per week is acceptable in my opinion, three calls per week max in my opinion is also acceptable. Anything over that should be put in writing. 

I was considering starting a network in Ireland for Credit Controllers. Works very well for our UK operations, whereby suppliers/wholesales/distrubition companies who share common customers can email each other once a month with updates on bad / slow paying customers. 

There is no other information sharing and simplying works on a grading system for each common customer.


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## Complainer (16 Dec 2010)

Kluivert said:


> I was considering starting a network in Ireland for Credit Controllers. Works very well for our UK operations, whereby suppliers/wholesales/distrubition companies who share common customers can email each other once a month with updates on bad / slow paying customers.


This would probably breach Data Protection law.


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## callybags (16 Dec 2010)

I would much prefer to rely on my own first hand information rather than the reports from other companies who may well have a different agenda.


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## Kluivert (16 Dec 2010)

Good point, however how it operates is based on a grading system. 

No information about the customer is released that it is not already available in the public domain e.g Telephone Book. 

Why this was set up was because of Supplier Shopping. 

Basically you would have a customer place order with you, then use the cash inflow from that order to pay me. Your then left with a debt owing for which you can not get paid, because the receipt has gone to me. 

Under Irish company law, unknown to alot of business owners and managers this activity is illegal and is referred to as preferential trading. 

However, in reality the practice is Ireland is to pay the supplier who shouts the loudest, which takes me back to main OP - how often is too often.


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## Kluivert (16 Dec 2010)

callybags said:


> I would much prefer to rely on my own first hand information rather than the reports from other companies who may well have a different agenda.


 
I deal with only other credit control departments in the UK, primary objective of all credit control departments is to ensure constant cash flow and minimise bad debts. 

This is a very effective means to achieving the secondary objective. 

At the end of the day, its an additional information source. What you do with the information is entirely up to you.

You always base your decisions on your own information first and foremost.


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## Complainer (16 Dec 2010)

Kluivert said:


> No information about the customer is released that it is not already available in the public domain e.g Telephone Book.
> 
> Why this was set up was because of Supplier Shopping.
> 
> ...



Now I'm confused. You say that you only release information in the public domain, but yet your intention is to share data about that company's dealings with you (orders or payments). Isn't this contradictory?



Kluivert said:


> What you do with the information is entirely up to you.


Not quite true. You must comply with data protection legislation.

Having said that, I may have been too quick off the mark here. Data protection legislation is generally about protecting the rights of individuals, not the rights of businesses. I'm not sure if businesses have the same rights as individuals to confidentiality.

I wonder (and I'm no expert here) if there might be any anti-competitive issues about sharing information like this?


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## Brendan Burgess (16 Dec 2010)

Complainer said:


> This would probably breach Data Protection law.



Does Data Protection apply to companies as well as to people? 

I would hope that there is an exemption to allow for such an important exception.  

If someone complains on askaboutmoney that they got bad service from xyz Ltd, is the complainer breaking the data protection act? I doubt it.


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## Complainer (16 Dec 2010)

Brendan Burgess said:


> Does Data Protection apply to companies as well as to people?



I'm not sure, as mentioned in my later post, "I'm not sure if businesses have the same rights as individuals to confidentiality."


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## Crugers (17 Dec 2010)

From the Data Protection Commissioner Website:
Their tag line is:
Protecting your personal privacy in the information age.

and
_What is data protection?_
_When you give your personal details to an organisation or individual, they have a duty to keep these details private and safe. This process is known as data protection._


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## JoeB (17 Dec 2010)

Well yes, it sounds like a good idea, at first.

But do the companies have any facility to change information which is wrong? If not then I have little doubt that you could be sued, if false information is published.

But is the info published (inpublic)?, or just shared privately?

Even if shared privately and the info was false then the affected company would be disadvantaged, and so may be able to pursue a course of action.

It sounds similar to 'rate my solicitor'... except it's 'rate my companies creditworthiness'


Companies perhaps have no rights under data protection, but they must have protection against lies or false info, which cause them to lose business. But sole traders likely do have rights under data protection... as they certainly aren't a registered business.

The ICB offer a facility where false info can be removed, although this is difficult in practice. But anyone can submit a personal letter which will be included with the credit report when it's requested.


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## Kluivert (17 Dec 2010)

Thank you very much for your contribution however none of your posts bar Callybegs have any relevance to my original question. 

Data protection has no relevance either with my suggestion for a network of credit controllers in ireland and your discussion on the matter has taken off, based on assumptions you are making which also has no relevance. 

Look its very simple. 

1. There is NO information on Third Parties exchanged between Credit Controllers. 

This is a point I stated above and none of you have quoted me on this. 

2. When a customer wishs to open a credit account with you, they will fill out a credit application form or an customer account opening form. What ever you wish to call it. 

On this form, they provide you with details of their business such as Trading Name, Business Address, Telephone Numbers and Contact Details etc. 

All of this information is freely available to you and me already in the public domain. 

For Example: CRH opens an account with you, can you already log on to their website, and see there company details. 

Joe Bloggs Store opens an accont with you, his name and address and telephone number is already published in a telephone book, website, trade magazines. 

Can you explain to me how this information relates to Data Protection please??????

In addition, on the form, they provide TRADE REFEFERENCES, normally two. A new customer will also enter what we call FRIENDLY TRADE REFERENCES. 

They are hardly going to put down two referees that they have bad debts with now are they?????

Every Credit Controll department will have standardise Trade Reference Requests. Details will ask to confirm Name and Address, What sort of Credit and Terms do they extend and How would they rate the customers ability to pay. 

Please explain what information is there that is relating to Data Protection????? 

Taking it one step further, you get the trade reference back from the two FRIENDLY REFEREES and both references are glowing. 

You set up a credit account with the new customer, give them a credit limit, they place an order, order is dispatched and they dont pay you. 

Can you sue the two businesses that provide the glowing trade references - NO!!!

A trade reference is based on an opinion. 

Therefore, for a credit controller, it is more benefical to seek more than two opinions. This is a credit controller network is more benefical. 

So you ask for 10 references on the network, 2 of them come back glowing while 8 come back negative. Can you now make a more informed decision on whether to extend credit to this new customer or not. Not in this case. 

Is this clear?


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## JoeB (17 Dec 2010)

I'd say that three calls a week amounts to harassment and is illegal. I'd say the same thing about two calls a week. The point is that it is illegal to harass people over debts. and it's a subjective judgement as to what amounts to harassment.. but three calls a week seems very excessive.

If the customer claims that one call a week is harassment then I feel you must respect that. Do you believe that the customer is unaware that he owes you the money and that three calls a week are necessary to remind him?


You say
Every Credit Controll department will have standardise Trade Reference Requests. Details will ask to confirm Name and Address, What sort of Credit and Terms do they extend and How would they rate the customers ability to pay.

Please explain what information is there that is relating to Data Protection????? 
................

The problem is 'how would they rate the customers ability to repay'. If you share or publish info about 'ability to repay' and it's false, then surely the company has some comeback. If the company could demonstrate that they had lost business due to false info 'shared' among club members then they may have recourse to do something. Would you be happy if a person stood outside your premises with a sign saying things that weren't true?


At the same time I see your point, and think it's not a bad idea.. it's just problematic in some ways. Getting paid is the hardest part of some businesses.


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## Kluivert (18 Dec 2010)

Hi Joe 

Thank you very much for a constructive reply. I appreciate your response and take what you said on board. 

Credit Control is a very hard job, no one likes to ask other to pay overdue accounts but if we didnt, then wages wouldnt be paid, suppliers wouldnt be paid and so on. 

Its tough times out there at the moment and it is vital for all businesses in all industries to support each other, and think of new innovativing ways to do business. 

I have to comment though that Irish businesses have a very bad attitude towards paying accounts. 

There is a massive difference between the attitude of Northern Ireland and UK customer compared to Irish customers and those in the UK, and those in the UK will tell you that customers in the UK are worst than those in Europe. 

I agree with Joe, two calls a week is about a right balance. First call to request payment, second call as a follow up to ensure that payment was sent on the day that they said it would be sent.


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## Time (18 Dec 2010)

It is a fine line between chasing up and harassment.


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