After registering, the particulars of the contract should be entered in the ledger. A form of ledger sheet used by a publishing house is shown in Fig. 29. This is loose-leaf, and does not differ in form from the ordinary balance ledger, except in the particulars given at the head of the sheet. Here is shown the name and both residence and business address of the customer, number of contract, monthly payment and due date, references, source of order, price and name of books, and date of shipment. These sheets are filed in post binders, five-hundred sheets to the binder, and indexed alphabetically.
The next step is to enter the contract on a collection card. A satisfactory form is shown in Fig. 30. This is a card 4×6 inches in size, and is practically a duplicate of the ledger sheet. The card is filed in a chronological file under the due date—that is, if payments are due on the 24th of the month the card is filed under that date. Except when removed from the file for the use of the collector, or to enter payments, the card is always filed under the same date. If it becomes necessary to have an account brought to notice on other than the regular collection dates, a memo is made on a separate card and filed in a special tickler.
Should it become necessary to refer to a card on other than the regular collection dates, reference to the ledger—indexed alphabetically—gives the due date, by which it is quickly located. Sometimes, however, it is desirable to refer to all contracts in a given territory. To make this possible, a card file with indexes printed with the names of states and cities is provided. For each contract a plain 3-×5-inch index card is used, the name, address, and contract number only, being entered. This provides a complete set of indexes—alphabetical in the ledger; numerical in the register; by due dates in the collection file; geographical in the card file.
When a payment is received, it is entered in the cash book and posted to both the ledger and the collection card. Every card must be located at the time payments are entered in the ledger, or the customer will very likely receive notices after he has made the payment.
The Collection Follow-Up. The promptness of the follow-up on this class of collections is of the greatest importance—the debtor should not be given the excuse that he failed to receive a notice. Though not provided for in the contract, the debtor expects a notice of every payment due.
When the goods are shipped, a formal notice of shipment should be mailed, and if the first payment has not been made, it should be requested. In ten days, or after the approval time limit has expired, a second notice should be mailed, provided no payment has been received. This can be a formal notice, and should assume that the goods are entirely satisfactory, and at the same time calling attention to the fact that the first payment is past due. If this does not bring a remittance within ten days, it is well to send a draft notice. This notice should go into the conditions of the contract in some detail, and, without assuming a threatening attitude, it should assume that if payment is not received within five days it is the desire of the debtor that a draft be made. Either the notice or the draft will usually bring the first payment, or the return of the goods.
Fig. 31. Attorney's
Collection Register
Each month, a formal statement showing the exact condition of the account should be mailed a few days before the due date. It is well, on this statement, to make an offer of a discount for cash to pay the account in full. A discount of 5% on an account that has several months to run will often be accepted, and is profitable to both parties. This statement should be followed in ten days by a second notice, also of a formal nature.
All notices up to this point may be printed, but further requests should be in the form of letters. Except when it has been found that an account should be handled in a special manner, form letters will be found most satisfactory. The letters should start out mild in tone increasing in insistence as the series is extended.