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Chasing unpaid invoices is often challenging for businesses, as they worry about maintaining important customer relationships while ensuring timely payment for completed work.
Balancing the need to protect a valuable customer relationship with the need to receive payment on time is essential. While it is important to avoid confrontation, persistent delays and vague promises can negatively impact cash flow and business operations.
So, how should you approach conversations with customers who owe you money?
The approach you take can significantly affect the outcome. The goal is to identify the reason for non-payment, address any obstacles, and secure a firm commitment to next steps.
Here are some practical ways to make those conversations more productive.
Be Proactive Before the Invoice Becomes Overdue
One of the easiest debt collection conversations is the one you have before a problem arises. For larger invoices or important customers, consider contacting them shortly before payment is due. This isn’t about chasing payment prematurely, but about ensuring all necessary information is available for the payment process.
Ask: “I am following up to confirm you have invoice 1234 and all required information to process payment by the due date.”
A proactive conversation like this can quickly surface and resolve simple issues that might delay payment.
- The invoice may have gone to the wrong email address.
- A purchase order number might be missing.
- It may need approval from somebody else.
- The customer may use a payment portal you weren’t aware of.
Finding that out before the due date is considerably easier than discovering it three weeks afterwards.
Prepare Thoroughly Before Contacting the Customer
Always have all relevant details ready before initiating a conversation about overdue payments.
Have the customer’s account in front of you and know:
- The invoice number
- The original invoice amount
- The amount currently outstanding
- The payment due date
- How many days overdue it is
- The agreed payment terms
- Previous conversations or promises
- Any dispute that has been raised
- Who you have already spoken to
If you intend to claim interest or recovery costs, verify your legal and contractual entitlements in advance of any discussion.
For qualifying business-to-business debts, current UK legislation may allow statutory interest and fixed recovery compensation on late commercial payments. Whether these provisions apply will depend on the circumstances and contractual terms.
Preparation sets a positive and professional tone for the conversation.
Instead of: “I’m calling because I think this invoice is still outstanding…”
you can say: “I’m calling about invoice 1234 for £6,500, which was due for payment on 30 September. Can you tell me what’s preventing payment from being made?”
That’s much harder to answer with a vague response.
Establish the Cause of Non-Payment
Don’t assume the customer is deliberately withholding payment.
A useful question is: “Can you clarify what is preventing payment of this invoice?”
Then listen to the answer.
There may be a genuine administrative problem you can resolve immediately, but the answer may also reveal something more concerning.
“We’re waiting for our customer to pay us.”
“We’re having some cash flow difficulties.”
“The director hasn’t approved it.”
“We’re not happy with part of the work.”
Each requires a different response. Your first job is to establish which problem you’re actually dealing with.
Seek Specifics Beyond General Responses
“It’s with accounts” isn’t a payment date.
Neither is:
“We’re looking into it.”
“It’s being processed.”
“The director needs to approve it.”
If you receive a vague response, guide the conversation towards specific, actionable information.
Ask:
“Who in accounts is dealing with it?”
“What still needs to happen before payment can be released?”
“When is your next payment run?”
“Is there anything you need from us today to make sure it is included?”
You are trying to turn a vague assurance into something specific you can follow up on.
Obtain a Definite Payment Date
“We’ll pay you soon” sounds positive. It isn’t particularly useful.
Before finishing the conversation, try to establish:
- How much is being paid?
- On what date?
- By what method?
Always confirm the payment arrangement in writing.
For example:
Thank you for speaking to me today. As agreed, payment of £4,800 will be made by bank transfer on Thursday 15 October.
Now there is no ambiguity about what was agreed. If the payment doesn’t arrive, your next conversation is also much simpler. You’re no longer asking when they intend to pay, you’re asking why they haven’t done what they specifically agreed to do.
Document Every Payment Commitment
This simple habit can make a big difference.
After each significant conversation, document:
- Who you spoke to
- The date and time
- What explanation was given
- What they agreed to do
- The promised payment date
- When you will follow up
Then send a brief written confirmation.
If the matter eventually needs to be escalated, you have a clear timeline rather than trying to reconstruct months of telephone conversations from memory. It also helps you spot a pattern. One missed promise may have a genuine explanation. Four different promised payment dates should prompt a different conversation.
Handling Claims of Missing Invoices
This is one of the easiest objections to deal with. Don’t spend ten minutes arguing about whether it was originally sent, resend it while you’re speaking to them.
Then ask:
“Can you confirm you’ve received it?”
Once they have:
“Is there anything else you need before this can be approved for payment?”
And finally:
“When will it now be paid?”
You’ve removed the reason for the delay and brought the conversation back to payment.
“We’re Waiting for Our Customer to Pay Us”
This requires a little more care.
It may genuinely indicate that your customer is experiencing cash flow difficulties. But their debtor isn’t your debtor. If you’ve fulfilled your obligations and payment is due under your agreed terms, you need to establish what your customer can realistically do.
Ask:
“When are you expecting those funds?”
“What payment can you make to us in the meantime?”
“If full payment isn’t possible, what are you proposing?”
The answers will help you decide whether this is a temporary problem you can manage or a warning that the debt needs more urgent attention.
“We Can’t Pay the Full Amount”
This is the point where businesses can accidentally turn an overdue invoice into a six-month problem.
Don’t immediately offer: “Just pay whatever you can each month.”
If a payment plan is appropriate, structure it.
Establish:
- How much can you genuinely pay now?
- What will the instalments be?
- When will each payment be made?
- When will the balance be cleared?
- What happens if an instalment is missed?
Put the agreement in writing and monitor it.
My Debt Recovery has successfully used negotiated repayment arrangements where they provide a sensible route to recovery, but the important word is negotiated. A payment plan should be an agreed route to clearing the debt, not an indefinite extension of the original payment terms.
Recognise When to Escalate the Debt
At some point, another telephone call is unlikely to achieve anything.
Look for patterns such as:
- Calls repeatedly going unanswered
- Emails being ignored
- Several broken promises to pay
- The reason for non-payment continually changing
- A previously unmentioned dispute suddenly appearing
- Requests for more time without any payment being made
- The customer refusing to commit to a payment date
- Signs that the debtor may be experiencing wider financial problems
At this stage, the question should be: “Is continuing to chase this ourselves still the best way to recover our money?”
Communicate Next Steps Clearly
If you’ve reached the point where you need to escalate the matter, say so clearly. Avoid threats you aren’t prepared to follow through on.
Instead, explain the next step factually.
For example:
“We’ve tried to resolve this directly, and the agreed payment dates have now passed. Unless payment is received by [date], we’ll need to refer the account for recovery.”
Then follow through.
Repeatedly giving “final” deadlines and then doing nothing when they pass can weaken your position with the debtor.
Effective Debt Recovery Relies on Clarity, Not Aggression
One of the biggest misconceptions about debt collection is that you need to become increasingly confrontational to get results. You don’t. You need to become increasingly clear. What is owed? Why is it owed? When should it have been paid? What has the debtor agreed? What happens next?
A calm, factual conversation backed by accurate records can be far more effective than an angry one.
Knowing When to Engage a Debt Recovery Specialist
There is nothing wrong with trying to resolve an overdue invoice internally. In fact, that’s where most businesses should start, but at some point, repeating the same conversation costs you time without bringing the money any closer. Bringing in a commercial debt recovery specialist changes that conversation.
At My Deby Recovery we start by understanding the debt, the communication history, and the circumstances surrounding non-payment. Where possible, we look to resolve matters through professional contact and negotiation. If a debtor needs time to pay and an arrangement is commercially appropriate, we may consider and monitor a structured payment plan. Where communication or negotiation doesn’t resolve the matter, the recovery process can be escalated. This may include a Letter Before Action and, where appropriate, further legal recovery options.
The key is not to let an overdue invoice sit indefinitely simply because you’re unsure what to say next.
If repeated attempts to resolve an overdue payment internally have not succeeded, consider us for professional debt recovery support.