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Old 01-31-2014, 09:49 AM
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Collecting Money Whats your approach?

I love how people get mad at me when they are 90 days past due. We have about 10,000 out over 90 days. Work that was done in Nov.
I use an outside collection agency American Profit Recovery and I let ny customers know that i need to wrap up their balance before the first week of Feb because anything over 90 days goes to collections. It amazes me how people get mad. We left a slip at time of application, sent an invoice, then send 3 statements. Then if they pay they dont pay the 3 months of late feees. Pisses me off.

So what is your approach?

Mike
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Old 01-31-2014, 10:35 AM
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Originally Posted by humble1 View Post
I love how people get mad at me when they are 90 days past due. We have about 10,000 out over 90 days. Work that was done in Nov.
I use an outside collection agency American Profit Recovery and I let ny customers know that i need to wrap up their balance before the first week of Feb because anything over 90 days goes to collections. It amazes me how people get mad. We left a slip at time of application, sent an invoice, then send 3 statements. Then if they pay they dont pay the 3 months of late feees. Pisses me off.

So what is your approach?

Mike
Sounds like you have a good system in place. But if that fails send Louie and franky in after dark with a louisville all kidding aside I hate those people. Amazing they get mad, if I was in their shoes I'd be embarrassed not mad.
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Old 01-31-2014, 10:45 AM
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10k is not chump change. You might want to consider keeping a cc on file in the future. That's a significant number of deadbeats you have. Have you tried direct contact? I would be sitting in driveways for that money.
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Old 01-31-2014, 10:48 AM
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just got a responce from a guy that owes $695 he says Ill have to see the contract. Im like you wait till 96 days to question the contract, not after the day of service or the invoice or the 3 statements you got? wtf
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Old 01-31-2014, 10:55 AM
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10k is not chump change. You might want to consider keeping a cc on file in the future. That's a significant number of deadbeats you have. Have you tried direct contact? I would be sitting in driveways for that money.
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The problem with the cc is the amount of % you give away. 2% off the top or whatever it is.
The problem is that we do multiple services in a month and bill. So we might be there for fertilizer, perimeter pest, tick control, mosquito control. so our balances can run up very fast leaving a lot of exposure to getting screwed.
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Old 02-01-2014, 01:49 AM
PenningsLandscaping PenningsLandscaping is online now
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The problem with the cc is the amount of % you give away. 2% off the top or whatever it is.
The problem is that we do multiple services in a month and bill. So we might be there for fertilizer, perimeter pest, tick control, mosquito control. so our balances can run up very fast leaving a lot of exposure to getting screwed.
2% of 10,000 is $200.

do you know what 100% of 0 is? 0. Which is exactly what you have. Factor the CC fees into your estimates and prices.

You don't have to bill every statement on a card. But having one on file, for these situations, already pre-authorized makes your life easier. You're pissing more money away on collection efforts and way more time than the $200 in credit card fees will cost you.

Last edited by PenningsLandscaping; 02-01-2014 at 01:53 AM.
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Old 02-01-2014, 09:18 AM
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[QUOTE=PenningsLandscaping;4949483]2% of 10,000 is $200.

do you know what 100% of 0 is? 0. Which is exactly what you have. Factor the CC fees into your estimates and prices.

You don't have to bill every statement on a card. But having one on file, for these situations, already pre-authorized makes your life easier. You're pissing more money away on collection efforts and way more time than the $200 in credit card fees will cost you.[/

I'm leaning that way but I would be giving away more profit. If for easy math I did 100k a year and had a 30 per margin. The cc cost would be 2k. 30k profit the 2k would be between 6 and 7% of your profit. To raise my prices by that much plus my reg raise on materials when I'm on the high end price wise would be suicide. When the numbers get over 500k that's a lot off the top. But I hear you. Maybe anyone who is late once goes to cc and look at the history on all others and keep them on checks.
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Old 02-01-2014, 11:05 AM
PenningsLandscaping PenningsLandscaping is online now
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[QUOTE=humble1;4949581]
Quote:
Originally Posted by PenningsLandscaping View Post
2% of 10,000 is $200.

do you know what 100% of 0 is? 0. Which is exactly what you have. Factor the CC fees into your estimates and prices.

You don't have to bill every statement on a card. But having one on file, for these situations, already pre-authorized makes your life easier. You're pissing more money away on collection efforts and way more time than the $200 in credit card fees will cost you.[/

I'm leaning that way but I would be giving away more profit. If for easy math I did 100k a year and had a 30 per margin. The cc cost would be 2k. 30k profit the 2k would be between 6 and 7% of your profit. To raise my prices by that much plus my reg raise on materials when I'm on the high end price wise would be suicide. When the numbers get over 500k that's a lot off the top. But I hear you. Maybe anyone who is late once goes to cc and look at the history on all others and keep them on checks.
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Late is one thing, thee months late and saying "I need to reread this contract" is a whole other. Again, I'm not saying all cc, that's just too much off the top. But you did 100k, with 10k out. That's such a small percentage in cc fees. Like .02%. If you're charging late fees, they'll cover cc costs and are cheaper than collection agencies.
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Old 01-31-2014, 11:05 AM
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2% on 10k is only 200 dollars. That seems well worth the cost. How much have you lost in 90 days in the form of interest and agony? 90% of my customers use cc. I couldn't imagine trying to operate on an all cash or check basis. The fact their on contract only adds to why these people feel its ok to not pay for services rendered.
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Old 01-31-2014, 11:07 AM
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Quote:
Originally Posted by humble1 View Post
I love how people get mad at me when they are 90 days past due. We have about 10,000 out over 90 days. Work that was done in Nov.
I use an outside collection agency American Profit Recovery and I let ny customers know that i need to wrap up their balance before the first week of Feb because anything over 90 days goes to collections. It amazes me how people get mad. We left a slip at time of application, sent an invoice, then send 3 statements. Then if they pay they dont pay the 3 months of late feees. Pisses me off.

So what is your approach?

Mike
We do the exact exact same. We are looking at about 25k past 60.

Driving past a neighbor owing about 700 now, i asked my wife if she remembers that old time value of paying your bills? Seems to be lost these days.
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