27th June 2014 Posted by Warren Paull
Collecting accounts receivable can be difficult, particularly if you are a multinational doing business outside the country. Language barriers, cultural differences, different law and geographical distances can be a nightmare. However, cross-border accounts receivable management is not as complicated as it seems.
It is all about being specific about the ultimate goal, how you will achieve it and your ability to communicate with your clients. MoretonSmith’s commercial relationships throughout the world have helped us gain many years of experience in international debt collection. We’ve identified a number of critical success factors in this area; today we’re talking about the advantage of utilising native language collectors.
One of the most important aspects of effective collection of receivables is to establish solid relationships with your clients abroad. Good personal relations can ensure better transactions between organisations; the best non-adversarial creditor-debtor relationships are built upon being able to communicate clearly with one another, in a language that each party is completely familiar with and in a friendly collaborative manner.
Clear Objectives and Expectations
Providing invoices and describing payment terms in your client’s native language allows you to prevent any uncertainty on the client’s part as to when the payment is expected- a common reason listed by debtors for failure to pay. As a natural result, a fair and just collections process helps build trust with the client. This lays the foundation for them to process a timely payment, not only in the interest of avoiding late penalties but in terms of corporate social responsibility.
Full use of native language collections techniques extends to written communication as well; each and every reminder must be provided in a way that your client completely understands.
Achieving a relationship in which the client feels free to contact your accounts receivable department, knowing that they will be able to easily explain any situations that have arisen, helps to keep the lines of communication open- even if circumstances prevent the client from being able to process a timely payment. It’s always better to be kept ‘in the loop’ instead of having a client go silent with no payment received.
Culturally Appropriate Negotiation Tactics
If and when it becomes necessary to negotiate an adequate and agreeable settlement, a native language collector becomes indispensable. It can be easy to lose sight of the fact that not only is a collector hired for his or her language proficiency, but superior negotiation and diplomacy skills as well. When these two abilities converge you are able to benefit from a highly valuable advantage in your negotiations.
The cultural insight of a person who possesses a deep understanding of the preferred negotiation tactics utilised within your client’s country can often mean the difference between a settled account and one that must eventually be written off.
Assuring your clients that they’ll be able to speak to someone in their preferred language about important financial transactions can also be a key factor in obtaining new business. If you have identified a need for native language collectors and this specific type of high-context communication in your accounts receivable department, we can help. With over 300 languages spoken in London we are able to source virtually any language you require. For further legal action and enforcement of debt collection, we also offer overseas representation in over 120 countries.