Do you have a system in place to track and follow up on declined payments from your customers? If not, I insist that you set one up today.
I’ve heard too many horror stories of a business owner who sold X only to find out months down the road that the person didn’t pay because of a declined credit card (or some other payment issue). This has resulted in thousands of dollars of lost income in some cases, yipes!
It is simply bad business, not to mention heartbreaking… especially if the timing is such that it’s too late to appropriately collect the money.
Put simply, what you need is:
- To put someone in charge of declines – make it their responsibility to follow up on overdue payments (and bring to your attention if need be).
- A spreadsheet to keep track of all declines or overdue payments so you can see at a glance what is going on (ours lives in Central Desktop*).
- Have that person run a “declines report” at least once a week from your shopping cart system (we do this on Fridays) and record any declines in the spreadsheet.
- They can then follow up with that person to arrange for payment – we start with an email (using our template), then follow up a few days later with another email if need be, and then a phone call if still no response. Then it is escalated to me as the business owner.
You will also want to consider what your standards are around this process. For example, if someone owes a payment of $50 or less and doesn’t respond after 2 emails and a phone call – is it worth it to keep chasing them down? Probably not as you could spend more money for the person chasing them down than their payment is worth.
The good news is that 9 times out of 10 people are willing to pay – it’s simply a matter of following up with them. Easy peasy.