Dealing With A Payment Dispute – How To Handle And Resolve Them Quickly In 5 Steps
It’s an unfortunate reality that every business faces far too often – customers disputing invoices.
The reasons for disputes are varied, sometimes there are alleged mistakes on an invoice, or perhaps they won’t accept it without a certain piece of information (such as a Purchase Order number).
Other times it may be that they no longer agree with a price.
Whatever the payment dispute reason, this can seriously impact the speed in which you will get paid for your services or goods – which in turn could also give you even more business headaches when you consider what else may be affected.
For any payment disputes which are raised, there are a set of ‘best-practice’ processes and methods which should be followed as quickly as possible.
Don’t forget, the longer that an invoice is in dispute, the longer it is before you will get paid.
Not only this, but you don’t want to damage any future business opportunities you will have with the client/customer.
We asked our in-house team of expert Debt Collection Officers what the most expedient and professional methods for resolving a payment dispute are. Here is what they recommended:
1. Prepare And Plan
Arguably the best thing to do for any payment dispute is for you to be prepared.
This means gathering all correspondence, documents, proofs (such as delivery notes, purchase orders, invoices, or receipts) and anything else related to the payment dispute.
It’s important (vital) to have as much information available as possible, the dispute will be resolved quickly if you prepare correctly.
If you have multiple payment disputes from different clients, you should prioritize who to speak with at this point.
This saves on wasted time later and helps ensure that the financial impact on your business is minimized.
2. Identify The Correct Person To Speak With
If a payment dispute is made, the person you must speak with is the one who is in charge of paying the invoice.
Confirming that you are speaking to this person will save time in the long run, and having this person’s contact details will be one more step into making sure that the matter is resolved swiftly.
3. Raise The Issue With The Customer
Quite often it can seem like quite a daunting prospect to speak with the person who has initiated the payment dispute.
Business owners often view this as having to walk the careful line between confronting the person who owes them money, whilst not upsetting them and compromising future opportunities.
We understand this completely, but it’s important to remember that the vast majority of disputes can be handled with a friendly and polite conversation.
As well as this, the longer you wait, the harder it may be to collect payment.
Our debt collection experts have conversations like this daily, and having the correct information combined with a friendly, professional manner is the most successful and expedient way to recover payments that are disputed.
4. Propose A Part-Payment
If you have reached this point and the payment is still under dispute, it may be wise to suggest a ‘part-payment’.
Sometimes, buyers only dispute part of an invoice. This can happen for various reasons, and most of the time it may be to delay payment.
Pushing for the full amount at this point can actually have a negative impact on the total figure as well as having a detrimental effect on the relationship with the client.
A part-payment proposal will tell you if the customer is serious about paying the full amount and also help you recover some of the debt right away.
For more advice on how to approach a debtor over a payment dispute, contact Frontline Collections now – our experts can give you some friendly advice on how to proceed, and even save you some wasted time by assessing the debt for free.
5. Maintain A Professional Manner And Tone
Whilst the vast majority of payment disputes can be handled with a friendly conversation, it’s an unfortunate reality that sometimes disputes can become unpleasant.
It’s something which every credit control team and business owner has had to face at some point, and if someone has become hostile towards you over a payment dispute, it may explain why you’re reading this article in the first place (don’t worry – we can help with this part!).
As said in the previous points – having all of the information and maintaining a professional tone is the most important factor in resolving a payment dispute.
Despite what a payer may say or how they behave, if you are objective, calm, fair, balanced, and firm then the conversation will be a lot easier, and an amicable solution is more likely to be reached.
Not only does is this the best approach, but it also reflects well on you. Your debtor will be reminded that they are dealing with a professional business, and future opportunities with them will be undamaged from your side.
If there are still issues despite a professional approach, it may be wise at this point to reach out to a professional debt collection agency like Frontline Collections to offer some advice on how to proceed.
Feedback On A Payment Dispute
Many times, disputes can be legitimate. A payment dispute can sometimes be a positive thing for your business (as strange as that might sound!).
If a department or person within your business has made an error, then it’s important that it doesn’t occur again.
Hearing what a payer feeds back in the event of a legitimate payment dispute can save you time and wasted resources in future transactions, and even help you to streamline and optimize all customer-facing aspects of the business.
Help With A Payment Dispute
If you’ve tried the steps above, or if your payer is proving difficult to negotiate with, the best option is to reach out to a debt collection agency, such as Frontline Collections.
Our team of expert debt collection offices helps hundreds of businesses every month recover monies owed to them, in the most professional manner possible.