Good communication can mark the difference between getting paid and writing an invoice off as bad debt. This is why it is vital to craft well-written messages for the collections process. The problem facing many accounts receivable departments is that they aren’t sure where to begin.
What is a Collections Email?
It’s a customer communication designed to remind a customer of a past-due balance. It provides information such as the invoice number, the total amount due, and how to make payment.
Fortunately, there are tried and tested ways to create communications that will not only speed up payments but strengthen customer relationships and improve customer experience in the process.
There are three primary types of customers you’ll likely deal with: new customers, high-value “white-glove” customers, and problem customers. When working with these accounts there are several different types of emails you’ll send:
- Welcome messages (for new accounts)
- Early payment reminders
- Past due notifications
- Client suspension warning
This blog post will provide examples of each, how to write them when to send them, and additional steps that can be taken to ensure payment.
Featured Resource: 20 Accounts Receivable Email Templates
Working with New Customers
When working with new accounts, it is important to focus on establishing a pattern of regular communication as well as contingencies in the event of late payments. This should begin with a simple introductory email that is automatically sent out after the customer’s first transaction with your company, as shown in the example below.
Subject Line: Welcome! Thank you for your business
Dear {BillingContactFullName},
We are pleased to welcome you as a new {BusinessName} customer. Thank you for your business and your trust.
Your dedicated AR Specialist is {ARSpecialistFullName} and can be contacted via {ARSpecialistEmail} or {ARSpecialistPhone}.
If you have any questions regarding your account, please feel free to reach out. It is our pleasure to work with you.
Regards,
{BusinessName}
As a best practice, this should be followed with an early payment reminder sent to the internal account manager seven days before the invoice is due. Regular internal communications will facilitate timely payment by keeping the customer’s regular touchpoint involved in the process. This email should include a quick link to the representative’s aging report so that they are aware of the invoice that will soon come due.
Subject Line: Assistance required: contact your client
Dear {SalesRepFullName},
Can you please assist the Accounts Receivables team by working with the client and providing us with any updates? To access your aging report, please click {SalesAgingLink}. Your assistance is truly appreciated. Thank you and have a wonderful day.
Regards,
{BusinessName}
Once an invoice has gone past due, it is important to follow up quickly with a polite reminder that the issue needs attention. At this point, the communication can be cordial, simply informing the customer of the essential information such as invoice number, total amount due, and due date. The email should also provide a direct link that allows the customer to see the full invoice, as well as an easy link to the self-service portal so that payment can be made immediately.
Subject Line: Reminder: an invoice requires your attention
Dear {BillingContactFullName},
This is a reminder that you have an invoice {InvoiceNumber} for {InvoiceTotal} that was due {InvoiceDueDate} and requires your attention. The total due on your account is: {StatementBalance}. Click {StatementLink} so you can review your current statement for {CustomerCompanyName}.
You can also make a credit card or ACH payment via the customer portal, just click here {StatementLink}.
Thank you very much for your attention to this matter. We value your continued business. *Kindly disregard this email if payment has already been processed.*
Regards,
{Company Name}
If the invoice remains unpaid, the communications can become firmer, clearly outlining the potential consequences of continued late payment.
➜ Download the “Accounts Receivable Email Toolkit” for Email Templates at Every AR Touchpoint
A Friendly Reminder
Your customers are different, and taking the same approach with each will not be the most effective way of communicating with them. For some high-dollar accounts, as well as those with a reliable history of on-time or early payments, it may be better to adopt a tailored approach. This will be a low-touch workflow that sends friendly reminders when an invoice is due and helps prevent any need for escalation.
As with the New Customer workflow, an early reminder should be sent seven days before the invoice is due. However, given the customer’s history, you can wait until payment has gone 15 days past due before sending your first follow-up. When sent, the email should contain the invoice number, the amount owed, and due date, as well as a copy of the original invoice.
Subject Line: First Notice: Sent as soon as the payment date has passed
Hi [Contact First Name],
We know that life can be busy, and it’s easy for things to fall through the cracks. This is just a brief note to remind you that [Invoice Number] for [Amount Due] was due on [Due Date].
The invoice is attached for your reference. If you have already paid, please ignore this email. If you have not yet paid, please do so as soon as possible. Please reach out with any questions or if you need to make payment arrangements.
Thank you,
[insert representative name and contact information]
A sales team notification should be sent at the same time. Additional follow-ups should include contact by phone as well as emails that are sent when the account is 15, 30, 60, and 90 days past due.
Resolving Issues with Difficult Accounts
From time to time, your organisation will encounter accounts that are either unable or unwilling to pay an invoice. These communications will require a more assertive tone and detailed descriptions of any fees or penalties that have been assessed as a result of non-payment. They should also clearly outline any future penalties, including legal action, that may occur if payment continues to be delinquent. Because these communications could potentially be used in court proceedings, it is vital to include all relevant details regarding the issue.
Subject Line: Your account has been suspended (90 days past due)
Dear {BillingContactFullName},
This is an important note and requires your immediate attention. We have sent several reminders that the invoice {InvoiceNumber} for {InvoiceTotal} is overdue. This invoice is now over 90 days past due. Unfortunately, we have suspended your account and purchasing access has been revoked until payment for your outstanding balance is paid in full. You can make a credit card or ACH payment via the customer portal, just click here {StatementLink}.
Click {StatementLink} so you can review your current statement for {CustomerCompanyName}.
Please resolve this matter as quickly as possible to re-establish your account. If you have any questions, please contact {ARSpecialistEmail}.
Regards,
{BusinessName}
Optimise Your Communications with Automation
While these templates and communication workflows can be handled manually, Adopting an automation solution is the easiest way to ensure maximum effectiveness. Rules can be set in place so that emails are sent out on a fixed schedule, or as soon as a payment is missed. In addition, rules can be created that automatically escalate communications if they continue to go unanswered. This will help ensure regular, predictable messages are sent out and that invoices are kept top of mind for the customer.
