Collection of Unpaid Membership Fees
If you have a company that offers goods or services that require some kind of periodic membership fee with a contractual term attached to it, there’s a good chance that you will have encountered a situation where one of your clients experiences financial difficulties and is no longer able to continue paying their fees.
Or it could be that someone flat out refuses to pay any more, even though their contract says that they need to pay for ‘x’ amount of remaining months. In either sense, it’s a problem that needs sorting out.
Membership fees are a widely used format for taking payment and could apply to:
- Gym memberships
- Private Members Clubs
- Childcare services
- Automobile & Business clubs
- Golf Club Memberships
- Trade Associations
- Tax Schemes
Pretty much any business that takes monthly payment for a contracted service could experience this same kind of issue.
So, what do you do when faced with a non-paying client?
There’s the obvious route of calling the debtor or writing to them periodically with an increasingly serious tone in the hope that this is enough to prompt payment. In many cases, this is more than enough to resolve the issue, but there will be the odd case where this has no effect at all.
You need to have another option or you could face losing hundreds of pounds or spending time you can’t afford to lose on a lengthy route to repayment through the small claims court.
There has to be another option.
We’ve all seen it before…a client signs up to something for a set amount of time and thinks that because they no longer use the service they’re contracted to, they don’t have to carry on paying for it? Right? In a word, no.
Unfortunately, when someone agrees to a service that requires a membership fee for a set amount of time, this is a financial obligation and usually will have involved the physical signing of a contract of some kind. Like it or lump it, if a contract is signed, the company providing the service is entitled to be paid.
It might seem unfair to the client, but a gym, for example, requires on it subscriptions to pay for lighting, heating, electronic exercise equipment use, it’s the staff…the list goes on. Companies like these need to protect their livelihoods by holding people to contracts they’ve agreed to.
Professional Debt Collection Agency
This is where a professional debt collection agency can be a great ally to have in your corner. Collection of unpaid membership fees is essential to the life cycle of your operation.
A reputable and professional Debt Collection Agency can act an extension to your credit control.
They can chase the debt on your behalf in a friendly, ethical and firm manner to recover the monies owed and as many will operate a ‘no collection – no commission’ service, the only thing you’re likely to lose in the process, are your worries.
A modern, accredited professional debt collection agency will work on your behalf in a way that won’t reflect badly on your business and resolve the issue in as painless a manner as is possible. This method can be considerably faster than dragging someone through the court to recover the debt and having someone take over the issue for you will free you to concentrate on your core business.
So, if this is you right now, open your mind to the paradigm of a modern debt collection company. It could be just what the doctor ordered.
If you require assistance with the collection of unpaid membership fees then speak to one of our friendly New Business Team today.