“Please.” “Thank you.” “Excuse me.” Those are common courtesies that smooth the interaction between people in public. They also encourage the public to treat one another with respect. Similarly in commercial debt collection, if you treat the first collection letter to an overdue customer as a common courtesy, it will improve your collection efforts and encourage a respect for timely payment.

It is generally assumed that a phone call is considered the best first contact when a customer becomes overdue. Unfortunately, phone contact carries with it a lot of time and effort. The seemingly endless calling, being left on hold, leaving messages, returning messages, etc. that is inherent in this method distracts from the core effort of running the business.

However, it is possible to use a collection letter as the first contact, and get results similar to phone contact, but without the cost and time involved with using the phone.

The letter just needs a few important components. (more…)