Morning everyone. So following on from my last post about my debt collection research, I would love to share with you some of the results. I asked each participant 10 questions, each with 3 possible answers. Who doesn’t love multiple choice!! (ahhh the day’s of high school came flowing back, when in doubt you would always choose “B”!!!) Here are questions 1, 2 and 3:
Question 1. When you incurred this debt, did you honestly think you might struggle to pay it?
A- No
B- Yes
C- Maybe
92% of people chose A. There you go guys- an overwhelming majority of your customers have the very best intentions! 5% said they may struggle and 3% admitted they knew they would. Fascinating.
Question 2. Did the business explain to you their expectations around due dates and when you needed to pay by?
A- Yes I was told multiple times when I had to pay by.
B- No it was never explained to me.
C- It was mentioned very quickly that their terms are on their invoice.
87% chose C. Wow. I couldn’t believe that so many businesses in this country that extend credit are so lax about getting paid. Obviously I had a feeling this answer would be the clear winner, but not by such a massive margin. Guys, I cannot stress it enough- to give yourself the absolute best chance of avoiding a bad debt, you MUST tell your customers what your terms are and make sure they understand. That moment, right then, is when your customer is at their most impressionable- you must use it to your advantage.
Question 3. Which animal would represent the businesses attempts to recover this money from you before it came to us?
A- a Pitbull.
B- a Snake
C- a Cattle dog
D- a Sloth
57% said a Cattle Dog, 23% said a snake, 13% said a pitbull and the remaining 7% chose the poor sleepy old sloth! And yes, I actually asked this question! Guys, to get paid- you must be a Pitbull. 100% of the time.
Cheers guys, a long post today but hopefully you all find it beneficial!
Our inaugural small business debt collection survey