Robert Andreu
Director of Business Development
Hunter Warfield, Tampa, Fla.
“Having a good offense is your best defense,” declares Robert Andreu, a 26-year veteran of the collection industry and now director of business development at Hunter Warfield, a firm that represents more than 300 clients, including LBM giant Beacon Roofing Supply.
He advises dealers to do their homework on customers, including the use of thorough credit checks and reports during the credit application business. While it might not be necessary to spend $300 on a report for a customer buying $5,000 worth of materials, it might be a “must have” when a contractor walks up to the desk and orders $50,000 worth of goods.
“The first aspect is the preventive medicine side,” Andreu says. “What you do internally is the best place to start.”
But if you have a customer who doesn’t pay you, what do you do? Andreu advises his clients to write a plan, stick with it, and be event sensitive rather than emotionally sensitive with customers.
Action has to be taken once an account hits a certain point or date, he stresses.
“When you don’t have a systematic approach, you are certainly going to lose some of your ability to collect,” Andreu says, noting dealers should attempt to resolve any bad debt before it blows past the 60-day mark.
Customers should be hearing from dealer once a debt reaches the 45-day mark, if not sooner, according to Andreu. By the 60-day mark, terms should be communicated.
That could mean cutting the customer off, switching them to a charge on delivery account, or placing them on COD while making sure the customer is paying for some of their past debt at the same time.
“The credit manager should be asking for a payment arrangement without having to outsource to a collection agency,” Andreu says. “That’s truly the mark of a good credit manager.”
He also firmly believes in personal visits to customers to avoid any disconnection during the process. By meeting with the customer face-to-face, the dealer can get a better perspective of what the true picture is.
“If the guy owes you $10,000, that’s a good guy to take to lunch and spend $25 to $50 on,” says Andreu.
Back to the preventive side, Andreu advises dealers to attend industry association or bank-run meetings where dealers can discuss common customers who might be an issue. “The vast majority of people placed with us we’ve seen once or twice in the past,” he says. “Frequent fliers are very common in the industry.”
