Growing a business and getting more value from your efforts isn’t all about adding new clients. The adage that it’s easier to retain current clients than attract new ones, is still true. Being able to increase your average customer value will not only mean that your bank account looks healthier, your customer relationships will be stronger too.
Maybe you’re already doing debtor management for clients but not really charging for it. Maybe you can see that it’s clearly an area your clients would benefit from some additional support. Or perhaps you just know that there’s money being left on the table and you could be growing your business. Either way, adding debtor management is a smart way to increase the value of your current clients and set you apart from competitors in pitches to win new ones.
If you’ve made the decision to shift into this space, welcome! We know it can be daunting adding a new service to your business, but it’s definitely rewarding. CreditorWatch Collect can help you ensure it’s a success. We provide advice, software and services to make setting up and growing a debtor management service easy.
The first step on the path to offering debtor management is deciding on the type of service you’ll offer. This blog steps you through the different service levels you can offer. It also prompts you on questions you’ll need to answer to work out what level of service you want to provide.
SHOULD I OFFER A DEBTOR MANAGEMENT SERVICE?
If you’re still on the fence about offering debtor management or accounts receivable services, take a look at our blog piece ‘6 reasons for adding credit control to your service’ or run through our ‘offering a credit control service’ checklist.
WHAT SERVICES CAN I OFFER?
- Software only: The bare minimum. You only provide accounts receivable software (ie. CreditorWatch Collect) to your customers.
- Setup and training: In addition to supplying the software you also assist your customer with setup of their account and any training required.
- Process review/design: You take a deep dive into your customers’ accounts receivables processes, systems and workflows, and recommend improvements.
- Virtual credit controller: The whole nine yards. You manage your customers’ debtors including reminders, calls and reporting.
When offering software only, you connect your client’s accounting software to your chosen debtor management software (like CreditorWatch Collect) and invite them in – in this case you own the subscription and charge your client.
This is the most basic level of service with the least amount of value delivered in the long run. However if you’re time poor already, it can be a great entry point for offering debtor management which you can expand upon in the future.
SETUP AND TRAINING
At this service level, you complete the software setup and train your client how to use it. With CreditorWatch Collect, implementation is quick and easy and you’re supported by our team whenever needed. Setup can take anywhere between 30 minutes to several hours and varies according to several factors:
- How big is the client?
- Do they know what they want?
- How complicated is their desired process?
- How many stakeholders want input?
- How many customers or customer segments do they have?
- What are their reporting needs?
- How many users need training?
- Do they want to run a pilot first?
Your sales and customer onboarding process will help you identify most of the above questions or identify any red flags before you start. This will help estimate the time and effort required. If you’re not sure about an onboarding process, CreditorWatch Collect offers free marketing and onboarding templates to support you as you add this new service to your business.
PROCESS REVIEW & DESIGN
This is where your skills can shine and your clients can see the true value of having you as a partner.
Most of your clients and prospects will benefit greatly from a review of their current debtor management process. Most SMEs don’t intentionally design their debtor management process and will not have given it much thought. This gives you an opportunity to lead them to a vastly better solution.
Your process review doesn’t have to be restricted to just debtor management. It’s possible (or even likely) that deficiencies in other systems are causing some of the issues with late payment, for example:
- Quotes are not signed or approved
- Terms of business are not agreed or fit for purpose
- Invoices are not sent out on time
- The payment methods offered don’t suit customers
- There are quality issues causing queries / disputes
- Data is misaligned between systems causing invoices to be incorrect or sent to the wrong person
- The person tasked with doing the follow-up calls doesn’t have enough time or hates doing it
VIRTUAL CREDIT CONTROLLER
Similar to a Virtual Assistant, a Virtual Credit Controller (VCC) is perfect for businesses where:
- They can’t justify hiring a full time, or even part-time person to manage debtors
- They have dozens of other things to do with their time
- They struggle to consistently stay on top of debtors
- They find debtor management stressful or angry
WHAT ARE YOU RESPONSIBLE FOR AS A VCC?
A Virtual Credit Controller may work for a few hours a month or several hours a week, depending on the amount of work required. Primary responsibilities include:
- Ensuring the agreed debtor management process is followed every week / month
- Following-up customers via email, phone and SMS
- Resending invoices and statements
- Assisting in the resolution of disputes and queries
- Building rapport with customers, obtaining expected payment dates or negotiating payment arrangements if required
- Improving and refining the credit control system
- Providing updates, reports and recommendations to the business and key stakeholders regarding the status of Accounts Receivable
- Being a buffer between the business owner and late payers
Additional tasks can include:
- Processing payments & setting up direct debit authorities
- Recommending next steps for difficult accounts
- Initiating debt collection action
CreditorWatch Collect offers different levels of software and service that can be tailored to your clients according to their needs.
SELLING VIRTUAL CREDIT CONTROL AS A SOLUTION
The bottom line is that a virtual credit controller is dedicated to doing credit control. You are fully trained in debtor management. You’re an expert. You know all the tricks and tactics customers might use to delay payment and you know how to counter these in a way which is personable and maintains the customer relationship.
For your customers, key benefits of engaging you as their virtual credit controller include:
- Being the buffer. You’ll insulate them from late payers and the difficult conversations they can bring about.
- You’re focused and dedicated to the task. Unlike the business owner, you’re not trying to juggle the core function of the business against financial tasks such as credit control – it’s exactly what you’re here to do.
- You’re an expert in this. You know what makes a good credit control process and how to find improvements. This in itself should deliver your customer strong results.
The bonus for your clients with having a virtual credit controller is that their customers won’t know it. Typically when a VCC phones a client’s debtor, they introduce themselves as if they are an employee of the client. This means their customers are unaware that a third party is making the call which is better for the customer relationship.
If you’re offering credit control as a service you’ll want to highlight this against the other standard bookkeeping services you offer. Make sure you call it out, market it well and charge for it appropriately.
If you’re keen to get started click below to request a demo. We can run you through all the options, chat about what will work best for you and discuss pricing models for your client base.GET STARTED