How To Make Pest Control Customers Pay Us in Time

Ten Simple Ways To Getting Timely Payments From Customers

Volume 1 – Issue 3 – 13 December 2019

This is the third issue of PCO Mentor.  I am happy to share with you that our viewership (persons who read our newsletter’s second issue by email or on the web) was 546 as of 13 December 2019  (including 50%+ of email recipients who also read it).  In <10 days since our newsletter launch, it has been a rapid scaling up and I look forward to continued Indian Pest Control industry support to make PCO Mentor useful to readers to make their business better.

Last week, you received a list of reasons that customers give PCO’s for the delay in payment for pest control services.  This week, let us look at some simple ways by which we can ensure that customers have no choice but to pay us for services provided.

  1. Paperwork: There is a famous English quote: “No work is done, till the paperwork is complete.”  It is doubly so in the case of payments.  Unless a PCO has copies of quote, order, service record and invoice and can provide those in a jiffy, a customer can cite any one document of this list missing and delay payment and some customers do.  All these records as physical copies & soft copies on computers have to be kept handy and made use of, if necessary, to make customers pay.

  2. Additional records – rely on the digital trail: Truant customers could get away with a lot including feigning ignorance of follow-up made by PCO for payment.  In 2019, that is no longer possible.   The phone calls made to the customers, the SMS’, WhatsApp messages and email (including read: receipts) all can prove that a customer was pursued for payment.  Incidentally, courts recognize electronic messages as valid proof of activity, in this case, follow-up for payment.  Of course, one has to diligently maintain a back-up of messages and email apart from screenshots of call history.  The digital trail can be extremely helpful in proving that the customer was contacted but still did not pay.

  3. Proof for receipt of invoices: For many years I have successfully used a document – Acknowledgement for Receiving Invoice (ARI) – which customer provides after receiving the invoice.  Added in the form is the disclaimer – that ‘’invoices have been received and shall be paid as per contract and the customer has no dispute on the serviced provided’’.  This simple document when signed and stamped (needs date and place too) is a deterrent to unscrupulous customers to evade payment as they can’t contradict their own declaration for intent to pay after signing off the ARI.

  4. Follow-up: If there are to be three tips to get paid those are: Follow-up, Follow-up, and Follow-up!  No customer is waiting to pay any vendor including a PCO and there is no choice but to follow-up for payments.  This has to be done in-person, by phone and by email.  Overdue payments should trigger demand notices from the PCO and beyond reasonable limits, legal notice from advocates on behalf of the PCO.  Follow-up of payment works both ways – it makes most customers pay up & unknown to rogue customers, the evidence is built-up that the customer did not pay the PCO who made valid efforts to get the payment.

  5. Internal and external escalation: As payments are like oxygen to keep the PCO’s financial life going, all levels of the PCO team should get involved with delays involving the higher level of the team, till the very top.  The same is the case with who in customer organization is approached.  The highest level of the customer’s team should be involved in the release of payment.  Without escalating the matter and making customer’s top management aware of pending payments, it is not possible to get customers to release delayed payments.  If employees low in the hierarchy at both PCO and customers are discussing the matter pertaining to payment for too long and not able to resolve it, it is necessary for the PCO’s senior team to step in and get involved.  In payment matters, everyone in a PCO is responsible to ensure it happens from the customer end, so any employee should be willing to get involved in following up for payment.

  6. Daily Tracker: Each salesperson, branch manager, regional manager and head of the business organization should be aware of the progress in collecting payments.  Team members should not go home without being aware of how much amount has been collected and how much is pending and automated systems can be set up to flash details daily.  Like is rightly said, what is measured gets done and more so in case of payments.  Unless the PCO management shows it is very serious about collections and tracks and shares payment status daily, the employees are likely to take it easy and get by with minimal efforts to get payments from customers.

  7. Stoppage of services: I never understood why our industry is so shy and hesitant to invoke the service stoppage clause which is generally documented in contracts to force payment.  It is very foolish to believe that customer shall then cancel the contract and switch to another PCO if services are stopped.  Look at it differently – a customer habitually and excessively delaying payment is not worth serving.  So, if such a customer is canceling the contract we should be happy.  I would be.  Stopping services also ensure that further build of credit does not happen, as if a customer did not pay in 30 days, there is no guarantee they shall pay in 60 days or 90 days or even 120 days.

  8. Legal action: When a customer is contractually obliged to pay after receiving services, I don’t understand why PCO’s DO NOT initiate legal action.  Legal action doesn’t mean that a case is filed in court to demand payment.  There are other steps prior to initiating court case – an advocate can be hired to send out a notice on behalf of the PCO and many defaulting customers then pay and resolve the matter.  It is very important for PCO to have all records in hand before asking for legal notice to be served.  Any deficiency in the claim such as contradictions in the communication and absence of records weakens a claim if not making it untenable.  I have listed paperwork right at the start of this list and records have to be religiously maintained if the claim for payment is to be ensured.  Notices are to be sent to the Board of Directors in case of registered companies.  In the case of other types of entities, notices have to be sent to the highest authority as they are the ones more likely to take cognizance and resolve the matter by approving or ensuring pending payment.

  9. Only credit received in the PCO account is valid: After all the follow-up sometimes, PDC’s are received or the cheque issued gets bounced after being deposited.  All these are indicative of a failure of follow-up for payment.  Only credit received in the bank account and squared-off against pending invoices can be considered payment.  Hence, claims of the release of payment should always be followed up with full details of the date of payment, amount and invoices against which payment is made.  The success of follow-up is indicated by a reduction in the level of debtors and not by any other measure.

  10. Creativity helps: There is no single or simple way to resolve all payment issues.  Customers can be asked for part payment with rest also being paid as per mutually agreed schedule.  If the customer has goods of value, as a last resort, getting payment in kind can also be considered (it is better than not getting any payment at all).  Any and every method that can creatively get the payment from a customer should be considered.

Wish You A Happy Weekend.