Make the Effort
Collections success is also a result of effort. Managers have to work hard to ensure customers pay on time. They should understand that collections is one of their primary job functions and feel accountable for following a consistent schedule of activities. This clearly defined list should address when to make phone calls and mail letters, adhering to the timetables outlined in your state’s lien law.
Letters should never be delayed or postponed but consistently mailed at the prescribed intervals. You may also want to e-mail copies of letters to customers.
Phone calls are perhaps the most important part of the collections process. They should be made consistently and according to plan. The best approach is to call the delinquent customer before the grace period expires to help him avoid a late fee. Once he is delinquent, make another call. In short, call the customer before and after each step in your delinquency schedule. Additional calls should be made whenever necessary to avoid a lien sale.
Make sure your managers are making their collections calls. They should keep a log of when each call is made so you can easily check their notes and see the account status. Accountability is essential to the program’s success, and follow-up will ensure the job gets done.
In the end, it’s always best to prevent customers from getting behind on rent in the first place. When possible, get them to enroll in an automatic payment program.
Now more than ever, storage operators and managers need to focus on collections. If you create the right culture of professionalism, respect and accountability, and put forth consistent effort, you will see results. You will sustain revenue and manage delinquencies, thereby making your investment as lucrative as possible.
Rick Jordan Jr. is the president of RWJ Storage Management LLC, which provides third-party management, training and consulting for self-storage properties. To reach him, call 562.682.5003; visit www.rwjstorage.com.