Edmonton Fall 2021

COVID BUSINESS RECOVERY
What to Do When Payments Stop: 5 Urgent Steps
So What to do?
Collecting debt has always been one of the most uncomfortable
and delicate tasks in business.
In a time of crisis, it becomes infinitely more challenging.
Previously reliable customers no longer pay on time—
if at all. Even the best ones have stopped taking your
calls and their voicemail is uncharacteristically full.
When they DO answer, it isn’t good. Apologies, but
they can’t pay for an indeterminate period because of
COVID-19.
It’s not just you. Virtually all business models, both
B2B and consumer-facing, healthcare providers and
landlords, are in a similarly precarious situation.
There are 5 important steps every business owner
needs to take in order to minimize risk and be as proactive
as possible.
Assess the current situation. Take a look at your accounts
receivable and flag everything past due. Contact
all account-holders and make them aware that for
your business’ continuity you must be firm about due
dates. They should respect this need and do the same.
Alert past-due accounts that collection action is imminent—give
a specific date.
Take immediate action. Send all non-responsive accounts
and any that are more than 60 days past due to
MetCredit (as we remind our clients, 60 is the new 90
in the critical post-COVID-19 era). Our professional
debt collection agents will treat your customers with
respect, and establish a high payment priority for future
dealings.
The customer in many cases has an impeccable history,
making this an entirely new kind of problem. Good
business is hard-won, cost of sales is premium and
customer relationships are precious. Most importantly,
your brand reputation is priceless.
But here you are. Even the best customers are holding
out, and you have growing obligations of your own.
It’s painful and a source of tremendous stress.
Here’s the kicker: the worst is yet to come.
The forced shutdown has only just begun to take its
toll on businesses and consumers. Many are sitting on
a shrinking cash stockpile, waiting for a turnaround
that isn’t coming soon enough. If they owe you money,
they are spending it on other things—until it the last of
it runs out.
And despite the rosy flourishes being painted by some
politicians, the crisis is worsening. The subsidies,
stimulus packages and deferrals must soon end. Buying
habits and patterns have been massively disrupted, in
a lot of cases permanently.
If your business is already struggling to collect money
owed to it, it doesn’t take a master economist to envision
what’s in store. And the real economists concur it
will be very bad, for longer than many businesses can
withstand.
Fortify business processes. The way people paid you
in the past is probably not reliable enough for the new
normal. Risk reduction should be top priority: sales are
a dangerous liability when you can’t collect. Insist on
full payment or substantial deposits—and make your
credit application mandatory whenever you grant credit
(which is anytime you are not paid in full upfront.)
Be sure buyers understand when payment is due and
acknowledge their commitment to you.
Make it easy to pay—safely. We recommend Interac
eTransfer or debit payments because funds are immediate,
fees are low and there is little risk of chargebacks.
If you offer financing for larger amounts, partner
with a leasing or finance company that is equipped
to manage the risks.
Embrace the new normal. If you have been patiently
waiting for old buying habits to resume, don’t! Some
business models, such as airline travel, retail sales
and buffet restaurants will surely never be the same.
Instead of praying for the good old ways to come back,
find ways to help customers with their new needs. And
while you do it, protect your own business’ future.
This is a hard reset, not a speed bump. It is an opportunity
to become better, more efficient, and eventually
more profitable than ever.
Brian Summerfelt
President & CEO of MetCredit
1.888.797.7727
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