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Collections Best Practices
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customer, as well as when to contact the customer next and what other actions to
take. The first part of the database, the key contact listing, should contain the fol-
lowing information:
• Customer name
• Key contact name
• Secondary contact name
• Internal salesperson’s name with account responsibility
• Phone numbers of all contacts
• Fax numbers of all contacts
The contact log comprises the second part of the database and should contain:
• Date of contact
• Name of person contacted
• Topics discussed
• Action items
The information noted is easily kept in a notebook if there is a single collec-
tions person, but may require a more complex, centralized database if there are
many collections personnel. In the latter case, a supervisor may need to monitor
collections activities for all employees, and he or she can do this more easily if
the data is stored in a single location. However, a notebook-based database can be
set up in a few hours with minimal effort, whereas a computerized database,
especially one that is closely linked to the accounting records for each account
receivable, may be a major undertaking. The reason for the added effort (and
expense) is that it may be necessary to custom-program extra text fields into the
accounting software so that notations can be kept alongside the record for each
invoice; this is a surprisingly difficult endeavor, given the number of changes that
must be made to the underlying database. The most difficult situation of all is if a
company uses a software package that is regularly updated by a software sup-
plier. Any changes made to the software (such as adding text fields) will be
destroyed as soon as the next upgrade is installed, since the upgrade will wipe out
all changes made in the interim.
A good midway approach for avoiding these difficulties with a computerized
database is to use a separate tracking system not linked to the accounting soft-
ware. Such software packages are commonly used by the sales department to
track contacts with customers and can be easily modified to work for a collec-
tions department. They can be modified for use by multiple employees, resulting
in a central database of contact information easily perused by a collections man-
ager. An example of such a software package is Act! The only problem with this
approach is that there is no linkage between the customer contact information