We all look at our Aging regularly but how often do we dig down deep and analyze it? I recently review exactly how much we have outstanding and how old it is and found that I felt like the numbers weren't that bad but that I didn't really have anything to compare it to.
So, if you feel comfortable sharing (and I will to those that reply) what are your typical Aging percentages for money owed in 0-30 days? 31-60 day? 61-90 days? over 90 days?
Thanks!
Dan
We are 2 commercials stations in a small market. We have a policy of payment in advance for all new clients. We accept credit cards, which makes it somewhat easier for some clients., On past dues, we charge 1.5% INTEREST ON ANYTHING BEYOND 30 DAYS AGING. Agencies are a very different matter, as they usually lag 90 days on payment. So, we advise the agencies that anything over 90 days past due, we DO NOT PAY AGENCY COMMISSION and DEMAND the full contract paid in full. We also have learned by experience that agencies sometimes nit pick over calender versus broadcast month billing.
We also have in our sales person employment agreements, that we do not pay commission on any client 90 days past due. Thats an incentive for the sales person to work collections on their accounts.
We also offer a discount on contracts paid in advance.
Phil Mueller
KCYN-KCPX Radio
Moab, Utah
very interesting info Phil...thanks for sharing!
I've learned the best way to collect is with a credit card on file. We run all of the credit cards on the 15th of the month for the next month's billing. Logic for the client is you can get a bill from us or a bill from the credit card company - both will arrive about the same time and maybe you get air miles or some other inducement from the credit card company.
I've learned the best way to collect is with a credit card on file. We run all of the credit cards on the 15th of the month for the next month's billing. Logic for the client is you can get a bill from us or a bill from the credit card company - both will arrive about the same time and maybe you get air miles or some other inducement from the credit card company.
Jack, I am not sure if I fully understand, but it sounds like an interesting approach. Does this mean you bill every advertiser by credit card or only the ones who are past due? Have you ever had any push back from advertisers when their credit cards were charged? Did any of them ever attempt to dispute the charges?
We beleive you train the customer or the customer trains you. On all contracts, we try and get the customer to go the credit card on file route. This only works if you explain the benefit from the customer's angle. It really helps if it's a level bill situation and, in the past, we offered to bonus 10% in ads if the client agreed to do this. Obviously, not everyone agrees to do this for various reasons but it sure helps on collections.
you train the customer or the customer trains you
That is absolutely true!
So let me see if I can extrapolate just a little bit from there. Suppose a station develops a policy that says "If you are past due, we don't run your ads. Period!" We now have a carrot and a stick. The customer gets a 10% bonus for having the credit card on file and has peace of mind since he knows his ads will continue to run. On the other hand, if there is no credit card on file and he is late paying, he knows his ads can be yanked. I can see how that might really work.
That actually brings me to a question related to what is the best policy when a customer is late. Should you yank their ads or keep running them? (I will post a new thread for that question.)
Thanks for the reply.
