When a customer\'s account becomes past due, a business owner should a. not both

Question

When a customer's account becomes past due, a business owner should

a. not bother the customer over the past due bill, even if it is a sizeable one, for fear of alienating the customer and losing him or her forever.
   b. take immediate action in the form of either a letter or a telephone call that serves as a polite reminder that the bill is due and asks for payment.
   c. immediately turn the account over to a collection agency.
   d. call the "deadbeat" customer and threaten to ruin his or her credit by telling the customer's other suppliers about the past due account.

MGT 190 Entreprenuership

Explanation / Answer

The answer is "b" - take immediate action in the form of either a letter or a telephone call that serves as a polite reminder that the bill is due and asks for payment.

When an account becomes due, the organization or the owner should, as a first step, remind the customer that the amount is due. This should be done in a gentle, polite and courteous way. This is necessary so as to not hurt the customer's values. Even if the customer does not pay after the reminder then appropriate action can be initiated against the customer so as to collect the dues.

The law also requires that a reminder in the form of a call or a letter must be send to the customer before initiating any action against the customer.

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