How Do You Get Late-Paying Customers to Pay Without Losing Them?

Email, text or a phone call, and what consent texting needs

Each channel has a job. Email carries the record: the invoice, the payment link, the promised date in writing. A text is a short nudge with the link, for a customer who agreed to texts at that number. A phone call is for anything past the first week and for every dispute, because a person on the phone may say what no email does: the check is waiting on a signature, the bookkeeper is out, the patched drywall still bothers them.

For email, keep the reminder about the invoice and nothing else. The FTC’s CAN-SPAM guide treats an email as transactional when all of its content is of the kinds it lists, one of which “facilitates, completes, or confirms a commercial transaction that the recipient already has agreed to.” Apart from a ban on false or misleading routing information, such a message is “otherwise exempt from most provisions of the CAN-SPAM Act.” Add a seasonal offer and the whole email can count as commercial.

Texting needs more care, because federal law treats a text to a cell phone as a call. In Campbell-Ewald Co. v. Gomez (2016), the Supreme Court wrote: “A text message to a cellular telephone, it is undisputed, qualifies as a ‘call’ within the compass of §227(b)(1)(A)(iii).” That section of the Telephone Consumer Protection Act bars a call “using any automatic telephone dialing system or an artificial or prerecorded voice” to a cell phone number unless it is for an emergency or “made with the prior express consent of the called party,” with no exception written in for a business customer’s cell phone. Under §227(b)(3), a person may sue for “$500 in damages for each such violation” or actual loss, whichever is greater, and a court may raise that to as much as three times for a willful or knowing violation.

The FCC’s rule at 47 CFR 64.1200(a)(10) lets the customer revoke consent “by using any reasonable method,” counts replies such as “stop,” “cancel,” or “unsubscribe,” and requires the request to be honored within “a reasonable time not to exceed ten business days.” Whether a given texting tool is an automatic telephone dialing system, and what consent wording fits, are questions for the company’s attorney; this is not legal advice. The record that helps either way: a line on the work order where the customer agrees to billing texts at a named number, and texting stopped the day the customer says stop.

Who owns the past-due list: the owner, the bookkeeper or the office manager

One named person runs the list, and the owner keeps the decisions. Split that way, the reminders go out whether or not the owner had a free hour that week, and the hard calls still carry the owner’s weight. When the owner runs the list alone, it can end up worked in the weeks cash feels tight and skipped in the others, and a customer can learn that rhythm.

• The list owner, the office manager or bookkeeper who already handles invoices: sends the day 1, 7 and 15 messages, makes the calls, records every promise and dispute, and brings the list to the weekly review. A second person is named as backup.
• The owner: the day-30 call, payment plans, holds on new work, credits and write-offs, and any decision to send a balance to an attorney or an agency.
• The person who did the work, the technician, project manager or account lead: answers a question about the job within one business day, and stays out of the money conversation.
• Credits and write-offs: approved by someone other than the person who records payments, with the reason written on the invoice, so a quiet credit never closes a balance nobody collected.

The record can be notes on the invoice in the accounting software or a shared sheet, one row per past-due invoice, but not three inboxes and the owner’s memory.

The weekly receivables routine that keeps invoices from going past due

The schedule above handles invoices already past due. The weekly review keeps that list short: a fixed half hour on the same day each week, run by the list owner, with the owner joining for the last ten minutes to make the decisions that are waiting.

• Invoices due in the next seven days: confirm each one reached the person who pays it, so a missing purchase-order number or a wrong address gets fixed before the due date instead of after it. A two-line email does it: “Invoice 1048 is due Friday. Do you have everything you need to pay it?”
• Promises due: any promised date that passed without payment gets a call the next business day.
• The past-due list, sorted by days past due and then by amount: each invoice gets its next touch from the schedule, with a date.
• Disputes: each gets a reason (price, scope, quality of the work, missing paperwork, wrong contact) and a name. One open longer than a week goes to the owner.
• Three numbers, written down and compared with last week: total past due, the part more than 30 days past due, and promises broken this week.

Two habits upstream keep the review short. The invoice goes out the day the work is done, with the paperwork the payer needs, and the payment terms are written into the contract or work order before the job starts. A business already running a weekly cash-gap check can add the past-due list to the same sitting.

When a slow payer becomes a collections decision

A reminder works on a customer who means to pay. When the record shows something else, another reminder only adds days. Any one of these moves the account from the list owner to the owner that week:

• Two promised dates passed without payment.
• No reply to three touches across two channels.
• Thirty days past due with no payment date.
• A dispute where the customer will not say what is wrong.
• A request for new work while the balance is open.
• News that the customer is closing, selling or changing owners.
• A legal deadline coming up. A contractor’s lien right is one: Florida’s §713.08(5) says a claim of lien may be recorded “not later than 90 days after the final furnishing of the labor or services or materials by the lienor.” Illustrative arithmetic: on a net 30 invoice sent the day the work ended, day 30 past due is day 60 after the final work, leaving about a month. Other states set their own deadlines; the company’s attorney knows which applies.

The owner’s choices are few: a written payment plan with amounts and dates; new work on hold, or payment up front on the next job; a final letter stating the balance and the date of the next step; the company’s attorney; a collection agency; small claims court; or a write-off. Choosing among them is its own subject. What matters here is that someone decides, on a date, with the reason on the record, instead of the reminders running for months.

Keeping the customer while you collect, inside the rules

Start every conversation assuming a fixable reason, and fix the company’s own mistakes the same day: a wrong amount, a missing purchase-order number, an invoice sent to someone who has left. Keep one voice on the account. Offer a way to pay that fits, such as two dated payments agreed in writing. Keep day 30 as calm as day 1, and say thank you when the payment lands. Once the account is current, talk about the next job’s terms: a deposit, progress billing, or a card on file.

The federal Fair Debt Collection Practices Act is written for collectors working for someone else. The FTC summarizes it: “third-party debt collectors are prohibited from using deceptive or abusive conduct in the collection of consumer debts incurred for personal, family, or household purposes.” Its definition of a debt collector, 15 U.S.C. §1692a(6), leaves out “any officer or employee of a creditor while, in the name of the creditor, collecting debts for such creditor,” but includes a creditor that, collecting its own debts, “uses any name other than his own which would indicate that a third person is collecting.” A letter on the letterhead of an invented collection agency is the move to avoid. How the same rules apply once an account goes to an outside agency is in the guide to AR consultants and collections agencies.

State law can reach the business itself. Florida’s §559.72 opens “In collecting consumer debts, a person may not:” and its list includes contacting the debtor “between the hours of 9 p.m. and 8 a.m. in the debtor’s time zone without the prior consent of the debtor” and posting a “deadbeat list.” Florida’s §559.55 ties a consumer debt to a transaction “primarily for personal, family, or household purposes,” so a homeowner’s invoice and a commercial customer’s can fall under different rules. California’s Rosenthal Act counts as a debt collector “any person who, in the ordinary course of business, regularly, on behalf of that person or others, engages in debt collection” (Civil Code §1788.2(c)). Which rules reach which customers is a question for the company’s attorney; this is not legal advice.

When this is not worth outside help, and where the Review fits

If the past-due list is short, the schedule runs every week and the three weekly numbers hold steady, there is nothing here to buy. If one customer is the whole problem, that is a call from the owner, and possibly the attorney, not a project.

For an owner-led company where the list keeps growing, the Revenue Review looks at this under the Invoice → Payment hand-off. From the company’s own invoices, payment records and notes, it measures the days each customer actually takes against the stated terms, lists the invoices that went past due with no touch on record, and puts a monthly dollar figure on the money waiting. It does not collect balances or give legal advice. It takes two weeks, and the written report is the company’s to keep.

If the wait looks long, the next step is a free 20-minute call, where we say whether the routine above, run in-house, is enough.