By Ric Rooney, Sun Spot Atlantis

Respect for our customers is something so ‘Business 101’ that it just goes without saying. However, respect is a two-way street, and when customers no longer respect your business, it needs to be addressed. Two months ago I made the difficult decision to reinstate our collections policy and quickly turn bad debt customers over to a collection agency 30 days after we fail to collect a legally due EFT payment.

I hated to do it, as it invariably upsets customers. I got an angry email from one customer telling me how upset she was with me for turning her over to collections “over $20.00.” But sometimes you have to show a little tough love to your customers and demand that respect flow both ways. Since instituting our new policy, our bad debt number has dropped 75 percent.

Here’s part of my reply to the angry customer:

Here’s the thing; I waited patiently for 18 months (you declined in August of 2015) for you to take care of this small $20.00 bill, but you never did. I think 18 months is pretty patient, don’t you?

If you’re on our Sun Spot Atlantis email list, then you know I sent out an email to everyone weeks ago telling them that as much as I hated to, I was resuming our policy of sending past due accounts to collections. I implored all of you who had past due accounts to get them taken care of before they were sent to collections. Once Credit Systems has your paperwork, I am no longer allowed to collect that debt. They own your account now, I’m sorry.

When you say ‘only $20.00’ that’s part of the problem. To you it’s ‘only $20.00’ but you know what it is to me? It’s now approaching $20,000.00. That’s right, nearly $20,000.00 in past due accounts from all of those people who don’t think it’s a big deal. As one person who owed us money told me a while ago, “You take yourself way too seriously, you’re a tanning salon.”

I tried carrying a few thousand dollars in bad debt to keep the goodwill of my customers. It didn’t pay off and bad debt has tripled over the past three years. The indoor tanning business is a much tougher business then it was ten years ago and that’s why you’ve seen so many tanning salons close over the past few years.

Now, do we realize that there are circumstances that warrant a little consideration? Of course! When we call customers about a declined payment, we’re always willing to give a one-time pass to customers with excellent payment histories. But, when we call three times in that 30-day window and don’t get the courtesy of a return call, the next call you get will now be from our collection agency.

Like I said, I hated to do it, and it’s no fun getting calls or emails from irate customers saying they’ll never come back (they do). However, if you look at the drop in my receivables in just 60 days, sometimes, tough love is what it takes. It’s your business, it’s your livelihood, it’s your responsibility.