An article in the AICM Magazine I read several years ago sticks in my mind. It was a reprint of an article by a retired British Credit Manager. He passed a comment "the job of a credit manager is to remove all obstacles to payment". Whilst I endorse his comment, I believe it goes further than that. Our responsibilities include getting payment while at the same time maintaining good customer relations, and maintaining the cash flow of the business. I am not going to launch into a treatise on credit management, but highlight the undisputed most valuable tool we can use to do that – the humble telephone.

To dinosaurs like me, it is the telephone (or phone). To others it may be the mobile, the cell, the i-phone, the smart phone. Call it what you will, it can't be beaten. Unfortunately, the telephone appears at times to be a dying resource. E-mails, Facebook, Linked-in etc are taking over. I can recall in my earlier years working in a bank where we had secret code books and telex machines for communicating with overseas banks. Modern technologies have definitely made life easier, but they should not replace the basics. I have even seen staff e-mail the person sitting at the next desk. What? Get real! You have a mouth. Other people have ears. Use them.

Some people say I am old fashioned. Maybe I am, but I do keep up with technology. I never used to be able to figure out how to use the video, now I can't figure out how to use streaming. I can use a computer, I am competent with EXCEL and WORD, but I would never call myself "tech-savy", and facebook is beyond me. How many times do you sit in a restaurant, and see all people at one table engrossed in their mobiles? I can see a use for it, but we appear to be losing the basic art of communication by talking.

I once had to set up a facebook account to look at some methodology published by a Government Department. I now get a constant barrage of requests from people I may or may not know wanting to be my 'friend'. I also get a constant stream of requests to join linked-in and other such forums. Sorry, no offence, but I have trouble in my average working day keeping up with the e-mails I receive. Why don't people just pick up the phone and say "hey Frank, can you do this for me?" or "what do you think of this?" or just "g'day." They would get a quicker response, my day would be easier, and our rapport would build. By talking to customers, you can build a rapport which can even skyrocket into genuine friendship. An e-mail can be ignored or deleted. To ignore a phone call is more difficult.

By building rapport with a customer, you can get to the stage when they will ring you if they have a problem. It makes your job so much easier. You can even build lasting friendships, be they strictly business or personal. Some are mutual, some
are one way, some you want, some you don't. But friendships help build that communication ability to soaring levels. I once made a 'friend for life' (more one way than mutual) by helping a customer manage his cash flow and save his business. Some years later he invited me for a weekend with him at a brothel his wife owned. The invitation WAS declined, but it shows the level of rapport that can be built by communication.

I do not allow my staff to use message bank. If a phone in the department rings during office hours, it must be answered. If the person on whose desk the phone sits is not there, someone else must pick it up and deal with the immediate problem, not just take a message. Generally, we, as credit managers, do not ring a customer unless there is a problem. Conversely, a customer does not ring us unless there is a problem. If a customer has a problem he wants it dealt with now, not later when you can find the time to call him back. This is called basic customer service.

If you are communicating with your customers, half your battle is won. At the start of this article I quoted "the job of a credit manager is to remove all obstacles to payment". Building on this, I say "if a customer has not paid, why has he not paid? What can I do so he can pay?" It may be that cash is a bit tight and he needs a couple of days. It is so much easier if the customer rings you and says "I am not in a position to pay you this month. I need a couple of days, but will definitely have my payment to you by the second". Yes, you will have an overdue account, but you would have had it anyway, but it is an account you don't have to follow up. This scenario occurs as a result of communication. Communication by phone. Talking to your customers, building rapport, not sending them an email, or a text message when they are overdue.

Tips when using collecting by telephone:
1. Answer it when it rings.
2. Never argue with a customer.
3. A customer is always right. It is part of the art of being a credit manager to convince him that you are more right than he is.
4. If a customer gets abusive to you personally, don't get upset. Tell him that you will hang up if he continues.
5. If a customer abuses your system, put up with it. He is entitled to his opinion. Take note and analyse your systems.
6. Diarise arrangements and follow up immediately if commitments not kept.

As a footnote, I do accept that in some consumer situations, contact by text is needed and used, generally used to high volume and small dollar amounts, but I seriously doubt it is as effective as a debtor answering a phone call from a credit officer.

*Frank Vredenbregt LICM (CCE), FIPA is Group Credit Manager for Automotive Holdings Group Limited.

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