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Keep an eye on your customers' spending habits. You
call on technicians every day and should have a good understanding
of their income potential in the facility where they
work. If your customer is working where the normal income
is $60,000 to $75,000 and they're driving a new Suburban
and riding a Harley and also have a boat and a nice house,
they could be up to their ears in debt!
GETTING CUSTOMERS TO PAY UP
All the caution in the world will not eliminate late payments
and skips as they are a fact in your business life. They need
to be handled quickly and firmly and, unfortunately, our
legal system says you can't be like Tony Soprano sending
your monster collection encouragement agents to motivate
your customers' repayments. So, what can you do when the
need for collections happens?
At the very first sign of a problem, take the person
aside from their coworkers and kindly talk openly about
their obligation to you. Explain that you understand that
problems arise in everyone's life and that you will be
happy to work with them on their payments but firmly
impress upon them that you expect your money. If you
come across as less than firm, you will be seen as an easily
delayed payment. In the first instance, you need to not
come across as overly aggressive or hostile but certainly not
wishy-washy.
Make sure your customer pays something, even if it is
not a full payment but don't let this continue. There are some
states where if you continue to accept partial payments the
courts may decide that you were satisfied with these partial
payments and must now allow them.
You need to be very careful that you do not impugn someone's
character at their workplace since this can lead to a
defamation lawsuit. But asking your " no-pay " customer for
your payments loud enough for some co-workers to hear is
not without its merit. Walking in the shop and announcing
that you are looking for that deadbeat so-in-so is not the
best way to approach this problem.
Once your customer has missed three or four weekly
payments, it is time for additional action. Three to four weeks
may not seem like a lot but if you miss three or four car
payments, the repo-man will be knocking soon. For each
month that passes, your chances of collecting are reduced
by at least 10 percent.
In jobber training, companies will say to not throw good
money after bad focusing more on your selling. This seems
very one-sided since your suppliers always get paid by you
and skippers don't really hurt them.
The court system is one alternative but depending on your
state laws this could take years and keep you significantly
away from your selling time.
For more information, click on PD e-inquiry at VehicleServicePros.com
Professional Distributor I October 2021 I VehicleServicePros.com 45
Collection agencies are a possible alternative, but they can
be so expensive that they may also not be worth your time.
Additionally, some collection agencies will want you to sign
the debt over to them. This is risky as the debt is now theirs
so you may not ever get repaid and if they own the debt,
they are not subject to any fair collection practices laws. A
service like Tool Dealer Network may be an option for you.
It is a mobile jobber only collection service that has reasonable
collection rates and follows the collection regulations.
If you are thinking that you don't want to be known as
a hard-ass by your customers, that is the wrong thinking. A
strong reputation in the industry for wanting your money is
perfect. And now, most importantly: Go sell something.
ALAN W. SIPE has spent the last 42 years in the
basic hand tool industry including positions as
president of KNIPEX Tools North America, senior
vice president of sales and marketing at Klein
Tools, manager of special markets at Stanley Tools,
and sales manager at toolbox manufacturer Waterloo Industries.
Currently, Sipe is the owner of Toolbox Sales and Consulting, a
company specializing in sales strategy, structure, development, and
training. alansipe@gmail.com
http://www.tooldealernetwork.com http://www.VehicleServicePros.com http://www.VehicleServicePros.com
october2021

Table of Contents for the Digital Edition of october2021
