In the above scenario, one of the first questions that may come to mind is why after two months when the invoice is past due is the customer now mentioning a problem with the product? To understand if the customer’s complaint is legitimate, we need to think about the existing business relationship.
For example, after our product arrives at the customer’s location, is it usually immediately inspected and confirmed or only when it is about to be used in their manufacturing process? If they have had a history of inspecting it right away, then why didn’t they mention the defect two months ago? If they are only mentioning a problem now after two months, this could lead us to believe that our customer is being evasive about payment. Conversely, if inspection of the product normally takes place much later after we have invoiced them, then perhaps their excuse is legitimate, especially if in the past there have been similar instances.
Furthermore, if calls have been made several times for the past due invoice but only now after two months, we suddenly hear about a defect that is preventing payment, that really doesn’t hold much water. Certainly, once a problem has been discovered the customer should let the supplier know so that corrective action can be quickly taken. If nothing was mentioned during previous calls for payment, then it’s not too difficult to think that the customer is trying to be evasive and avoid payment for other reasons.
Your thoughts are most welcome (email@example.com)!
Nancy Seiverd, President, CMI Credit Mediators, Inc.