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Addressing Chronic Slow Pay Customers
Some accounts must be constantly reminded to pay invoices. Follow up on commitments made by the customer may be necessary. In these situations, make certain to contact the debtor as soon after the account becomes past due as possible. If the debtor is paying others on time and your company slowly, the debtor is in effect using your money to pay other creditors.
Debtors always act in their own best interest. If they can find a competitor that can ship similar quality products at competitive prices but that creditor does not require strict adherence to payment terms, the debtor would be acting irrationally if it did not take advantage of that other opportunity. It will be difficult to convince the customer to pay invoices more quickly while keeping the customer's business.
Submitted by Michael C. Dennis