Top 10 excuses from debtors

In the world of credit management, it’s not uncommon to encounter various excuses from debtors explaining why they haven’t met their payment obligations. These debtor excuses pose a challenge for organizations, especially as financial pressure on customers increases. In this news article, we’ll outline the top 10 debtor excuses and explain how to handle them.

1. ‘I haven’t received the invoice.’

When a customer claims not to have received the invoice, it’s important to first verify the accuracy of the address and other relevant details. A prompt response is essential, including immediately sending a copy of the invoice via email. Simultaneously, it’s wise to discuss payment arrangements for the outstanding invoice with the customer. It’s advisable to always send invoices electronically via email.

2. ‘I can’t pay because my customers aren’t paying me.’

This common excuse requires a clear focus on the agreed-upon payment terms. A proactive approach towards the customer is crucial. Emphasize that both parties, including the customer, are responsible for timely invoice payments. Do not align with the customer on this excuse, as it often masks a general liquidity problem. It’s recommended to follow the policy and initiate the collection process after the due date to motivate the customer to fulfill their payment obligations.

3. The quality of the products/services was not good.

If a customer refuses to pay due to dissatisfaction with the delivered quality of the product or service, it’s essential to determine whether the complaint falls within the specified complaint period or if it’s an excuse to avoid payment. Emphasizing the importance of timely complaint notifications and objectively investigating complaints contribute to resolving this debtor excuse.

4. The accountant is on vacation, sick, absent, in a meeting…

When the absence of the accountant is used as an excuse, it’s important to place responsibility on the customer. By asking targeted questions, such as how the issue can be resolved, the customer is encouraged to actively contribute to a solution. No company should experience payment delays due to vacation periods.

5. The PO number is missing.

The absence of a purchase order number indicates incorrect invoicing. It’s crucial to check, before issuing the invoice, whether all expectations have been met. If not, promptly rectify the invoice so that payment can proceed. Proactively obtaining information about invoice preferences beforehand prevents companies from using this as a debtor excuse.

6. ‘We have cash flow problems.’

For customers citing cash flow problems as a reason, it’s advisable to establish strict payment agreements for the future. Ensure that you do not continue delivering goods or services when there are cash flow issues. The goal in this case should be to reduce the outstanding receivable, not increase it.

7. ‘We only pay 1 or 2 times per month/week.’

In this case, it’s usually possible to manually request payment. If not, ensure that your invoicing process aligns with the exact payment date of the customer to guarantee timely payment.

8. ‘We always pay on 30/60 days end of the month.’

For deviations from agreed-upon payment terms, it’s essential to refer back to the original agreement. Advocating for your own interests and not hastily agreeing to customer-requested payment term changes contributes to a healthy credit management.

9. ‘I forgot.’

In the case of the excuse of forgetting payment, it’s necessary to immediately make concrete payment arrangements to ensure prompt settlement of the invoice.

10. ‘I will take care of it as soon as possible.’

The promise of prompt payment requires vigilance. After expressing gratitude for the promise, it’s important to immediately make concrete payment arrangements to ensure that you receive payment for the invoice.

Additional tips!

Some debtors consistently come up with excuses, consuming a significant amount of your time and causing frustration. Always look at the bigger picture and consider rewarding customers who consistently pay on time by expediting their orders, for example. For customers who pay poorly or are consistently late, explore the possibility of replacing them with good customers and consider raising their rates to cover the incurred costs. Maintain a robust financial administration and, if necessary, initiate a collection process so that customers understand that the invoices are accurate and action will be taken if they don’t pay on time. You want to avoid being at the back of the queue.

The most important aspect is having good and reliable customers, and you can choose them. A credit report is crucial in this regard. Order our credit reports for each new customer and for any customer where payment delays are likely to occur. This way, as a business owner, you can sleep soundly!