“Negotiation calls can either make or break your collections game”.

Collectors have a tough job and often a difficult dilemma.  They are charged with getting payment within terms and maintaining a good relationship with customers while doing it.  Sometimes this involves real detective work involving difficult questions while trying not to alienate the customer.

The challenge is, if past due invoices are not getting paid, how to best communicate with your customers, demand payment as agreed, and get down to the “real issues”. A collector must be able to open the vault and get the facts. It all starts with probing questions.

According to a recent poll conducted by Highako, 60% of collectors said that they're not sure how to craft the right probing questions, while 30% said that their customers usually end up giving answers in yes or no.

Here are five suggestions on how to understand why payments are slow and hopefully get paid:

1. First determine if the person you are speaking with is the decision-maker. If not get to the person who can say 'Yes': As the old saying goes," Never allow a person to tell you no who does not have the power to say yes". For any negotiation, you need to deal with the contact who can reveal the issues delaying payment. Someone who has the authority to make decisions when a mutually agreeable payment plan is necessary. Once you determine the person you are speaking with cannot do that, ask for the contact who can.

2. Ask open-ended "Probing Questions": A probing question can never be answered with a simple 'yes' or 'no'. You can start with "please explain that to me", "help me understand", "how", "what", "when", "where", "who" or "why". Ask a question that will require a long-winded answer. In fact, the longer the better. A long answer is likely to surface points that will lead to additional questions and ultimately get you to the real facts and issues.

3. Leverage your listening skills: Listen carefully to every word, pick up on each bit of information they are providing. Stay engaged, don't let your mind wander, or think ahead. Ask probing questions when the real facts are not clear. Sometimes this will take you five or so repetitive questions. "When can we expect payment?" "Why is payment according to terms not coming immediately?" "What is driving your cash flow slow down?" "What is being done about that problem?" "When do you expect things to get back to normal?" "Who has the authority to get my company paid now.?"

4. Don't settle for opinions, "Nothing but the Facts": A fact is a proven truth, which is backed by evidence, whereas opinion is a personal view that may be uninformed. For example, You are speaking to an accounts payable contact who tells you payment has been made. Fact-finding questions, in that case, would be: What is the check number? What is the check amount? When was the check actually mailed? You may find the check has been cut, but it is being held by the Controller, who is closely managing cash flow. In that case, you need to speak with the Controller for the details

5. Work for a negotiated arrangement that meets the needs of both sides: Once you have the facts find areas where you can agree. Focus on what will motivate agreement by the customer. They need your product; you need payment within an acceptable timeframe. Once you understand the facts and know each party's limitations, you can work with the customer and aim towards a win-win solution.

Not every negotiation is successful. You may need to take actions to protect your company from a severely past due customer, or potential bad debt. Using these five communication techniques will help to reach a negotiated settlement that is acceptable to both sides when it is possible. This requires effective communication skills, and in today's tough business environment, an appropriate level of empathy.

If you are looking for more examples and how to practically implement this, here's a course on Collections Negotiations.