Collections without wrecking the relationship

Collections gets treated inside most brands as a personality trait rather than a process, which is why it is done badly and resented by everyone involved. The brands good at it recover faster and have fewer arguments, not more.

Most overdue money is a process failure, not a refusal

Before anyone makes a difficult call, run the document check. The common causes are dull and repeatable: the PO number is missing or does not match, the invoice was raised on the wrong entity or the wrong GSTIN, the e-invoice reference was never generated so their system rejected the document, the goods receipt was not posted so there is nothing to match against, the invoice reached a salesperson and never reached the accounts desk, bank details changed and the remittance failed, or a short-supply claim is sitting unresolved and freezing the whole invoice.

Fix it structurally rather than one invoice at a time. Build a pre-billing checklist per customer, because every chain and every distributor wants a different document set and the requirement is knowable in advance. Send a statement of account on a fixed cycle so mismatches surface in weeks rather than at year end. Where a chain is deducting against your invoices, debit notes and claims covers the proof and the contest, and that work belongs upstream of the chase.

The ageing view, and what each bucket should trigger

Age invoices from the agreed due date, not the invoice date. A single global bucket makes a customer on long terms look delinquent and lets a customer on short terms drift quietly. Then attach an action to each bucket, because a bucket that triggers nothing is a report, not a control.

Not yet due is the highest-return call nobody makes: confirm the invoice is booked in their system and nothing is missing. Just past due goes from your accounts desk to theirs, at document level, with no emotion in it. Older goes from your finance lead to their finance contact, in writing, with a statement of account and a specific ask carrying a date. Oldest stops being a collections question and becomes a supply question, owned by the commercial lead. The bucket does not decide the tone, it decides who calls and what the ask is.

Track two other things separately: unapplied credits, which quietly inflate what you think is owed, and the amount genuinely in dispute, held apart from the amount simply unpaid, because those are two problems with two owners. Marketplace-side reconciliation has its own shape, in settlement reconciliation.

Escalate by function, not by volume

The instinct when an amount is large is to go straight to the most senior person you know. That is backwards. Escalate along the function that can actually unblock the payment. Document problems belong to their accounts payable clerk. Payment run scheduling belongs to their AP manager. A commercial block, a scheme claim, a price dispute or a rate difference belongs to the buyer or category manager. Leadership to leadership is a once-per-relationship move.

Never open with the buyer. That relationship is a limited resource, and once you have spent it on a payment chase the next conversation you need will be about a listing or a promotion, starting from a deficit. Escalate on a clock set in advance and written into the process, so escalation is a schedule rather than a mood. Keep the salesperson out of the routine chase, because their incentive points at the next order.

The person who ordered and the person who pays are not the same

This is the specific Indian problem. The buyer, the warehouse that receives, the accounts desk that posts and the treasury that releases the run sit in different offices and often different cities, and the buyer has no visibility of the payment run. Chasing the buyer produces sympathy and no cash. Chasing accounts produces a document requirement the buyer could have waived in a minute.

Collect named contacts and working email addresses on all three desks at onboarding, before you need them; vendor code to first PO is the moment to do it. Ask two questions while you are there: what is the payment run calendar, and what is the document cut-off for it. That moves more money than any amount of chasing. In general trade the split exists in miniature, since the person you call is the proprietor and the person who pays is the accountant who comes in twice a week, and the super stockist and CFA structure decides which of them you can even talk to.

When a deduction is quietly the reason the payment is short

A short payment often is not lateness at all. The remittance is the invoice minus notes you never received, raised for shortage, damage, a scheme, expiry or a contractual charge. If you reconcile against your invoice you will conclude the customer is late. If you reconcile against the remittance you will see they consider the account settled, which is a completely different conversation.

So split the ageing into unpaid and deducted, and route them differently. Chasing a deducted amount as an unpaid one wastes your credibility and recovers nothing, because the person you are calling can see a closed line in their system. Distributors do the same informally, taking damages and scheme claims at their end without raising anything, which is why their ledger and yours disagree. That is exactly what a periodic signed ledger confirmation is for.

Firm without burning the account

Be predictable rather than aggressive. A chase that arrives on the same day every cycle, in the same format, with the same specific ask, gets treated as a process by the other side and stops being personal. Separate the person who chases from the person who sells so the relationship has somewhere clean to stand.

Never make a threat you will not execute, and never execute one without telling the commercial owner first. Put the consequence into the terms at the start, as covered in who really decides credit terms, so that enforcing it later is a contractual act rather than a personal one. Always give the counterparty a way to say yes: a dated commitment for a part payment against a named list of invoices beats a vague assurance, and write it back to them the same day so it exists in writing. Learn the difference between a customer negotiating and a customer in trouble, which is where a customer who stops paying begins.