TennisandSales

Head Of Sales

Customer hasnt paid us for 3 years.....

soooo as I was renewing all of our renewals, I found one that was close lost where the account is still a customer.

Reached out to Revenue and they said they had close lost the renewal in 2022 because they never heard from the AE......there was no AE at the time and our VP of Strategy was the lead at the time....they should 100% have known that.

So now we need to collect on the missed payments.

How would you handle this?

How would you advise the CEO to handle this?

Attached poll

take the L since its our fault and not ask for payment. Ask for the customer to pay the past due balance up front. Allow the customer to pay the past due balance over a number of years something else?

*Voting in this poll no longer yields commission.

😁 renewals

34 comments

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Sunbunny31

Arsonist

Sr Sales Executive 🐰

This happened when I worked at a large company that “lost” a number of customers when migrating CMS info.

A customer of mine that is sold years before reached out to get additional services … and I couldn’t find them in the system. I found a few more that also hadn’t been invoiced for years and were no longer in the system as customers.

In our case, I was able to work with our company, as they were unable to issue invoices after all that time and they deemed it not worth the effort to try and get paid when they had no way to recognize that revenue. I was able to re-sign each customer as a new customer. An awkward discussion of “guess what, we lost you, and we have a stack of back invoices” was made much easier by being able to say, “it’s our fault. We won’t bill you for the missing years, but we do need a new contract under our new terms, and we’ll take it from there”. Fortunately, our tech guys understood and didn’t try to set up a new platform or anything. And it was great for me, because I was able to recognize all the revenue as net new.

Gasty

Notable Contributor

War Room Community Manager

This is a great example relevant to the case here. If this is not possible then I'd send an invoice and see what happens. As you mentioned that they are solid customers and want to continue then it shouldn't be a problem. If they don't want to continue then they weren't solid.

detectivegibbles

Politicker

Sales Director

This is good SB. Well done.

Sunbunny31

Arsonist

Sr Sales Executive 🐰

I’m super glad I was enabled to be opportunistic. Win for the customer, win for me and my team w/revenue. Ultimately a win for the company too, as the revenue streams restarted. Better late than never!

jefe

Arsonist

🍁

I'd ask them to pay upfront but be flexible if need be as you guys fucked up.

Can you tell if they've been using the service? That could impact the approach

Filth

Tycoon

Live Filthy or Die Clean

Invoice send with a call offering and a little flex goes a long way before you have to pull out the, "you signed a contract" card.

TheDude

Politicker

Partnerships Lead

This but also acknowledge y'all fucked up.

Filth

Tycoon

Live Filthy or Die Clean

amen can't hurt to admit faults.

pirate

Big Shot

Account Executive

Take the L

If I pay for Spotify. Spotify forgets to charge me. I keep using Spotify. It looks pretty bad on Spotify to say oh we forgot, now pay for 3 years of Spotify usage... They would waive it.

Or another example. My employer had a glitch in the system and weren't paying me pension. Then a this random Indian guy was like oh we'll take it out of your next salary. Probably worth my 2-3 "next salaries". I was doing some research into the law and they legally have to pay me pension. So I escalated it and then company said they're really sorry, they'll match my contributions even though I wasn't contributing and it'll be normal from next month. This made me appreciate the employer and I felt I was treated right.

I'd make the customer understand the value... This is the amount customer ows but you're willing to waive it if they pay upfront for next year. A great opportunity to network within the customer and then possibly upsell or crossell them on something

pirate

Big Shot

Account Executive

Also if you make the customer pay for your mistake, I'd walk away from that.

LeadMachine

Big Shot

Sr. BDR

Yeah, worked for a co. Who didn't put a data tracker in the data storage product,when inserted into said SaaS solution, customers found out how much it would cost, we lost half the client base. From freeware to no where!!!

RandyLahey

Politicker

Account Executive

Need to be asking for the full amount, upfront. They've been using your product/service knowingly...

CuriousFox

WR Officer

🦊

🦡

RandyLahey

Politicker

Account Executive

Fox I always considered myself the GIF goat, but clearly there are levels I have yet to achieve. You dropped this…👑

MyAnonymousName

Opinionated

Sales Leader

Why? If there has not been any recognition of revenue wouldn't the best path forward be to get them on a new agreement, paying on normal terms and recognizing it as new revenue?

RandyLahey

Politicker

Account Executive

Did you read my comment? I explained why.

MyAnonymousName

Opinionated

Sales Leader

Yea and unless you are the CEO/Owner it is a shortsighted and silly way to look at things so I thought maybe there was better logic I was missing.

RandyLahey

Politicker

Account Executive

Love the sound logic and detailed explanation on your part, and glad you took up the time to comment, then edit a comment, on a month old thread. Enjoy your evening.

MyAnonymousName

Opinionated

Sales Leader

Thank you

detectivegibbles

Politicker

Sales Director

Can you stop service to get their attention?

These situations are always awkward but I’ve found being upfront and honest keeps and strengthens the trust.

“Yo customer, here’s the situation…we thought we were collecting, we weren’t. We’d love to keep you as a customer but this past due amount has to be caught up.”

Do they pay monthly? Annually? Maybe do something creative like rolling the balance into future payments to still collect while not hitting them with a fat invoice?

SaaSguy

Tycoon

Account Executive

Send an invoice, if they don't pay go to litigation - assuming this is an amount worth doing so.

Pachacuti

Politicker

They call me Daddy, Sales Daddy

It’s your company’s fault you haven’t billed them. Have they gotten any real benefit from your solution? Do they want to keep it?

TennisandSales

Politicker

Head Of Sales

solid customer they totally want to keep it. and we want to keep them

Gasty

Notable Contributor

War Room Community Manager

Then they should pay.

SalesBeast

Politicker

Sales Leader

Are they really a customer if not paid up?
Are they actually using your product or is it just an account sitting inactive?

Cloud Customer Success Manager

Before making a decision, I would need to know if the customer had been using the product during that time. If so, then since the blame lies with you, you can't demand full payment. Approach the customer, let them know that you will be stopping the free service unless payment arrangements are made for the current quarter or year and write off the balance. Technically, they don't have to pay a dime but if they like the product and are embedded, they will work with you to make it right.
If they have not been using the product/service, shut it down and take it as an on-paper loss, meaning adjust the books to reflect 1 less customer etc... I am not an accountant so I don't know how this would be handled.

TennisandSales

Politicker

Head Of Sales

interesting approach! why write off the balance?
even though it was my company who made the mistake, the customer budgets for this software every year and is well aware they are not paying when they should have been.

Why not ask them to make the full payment first?

Cloud Customer Success Manager

Primarily because you risk alienating them. Yes, they knew what they were doing but very few people and even fewer companies would not take the free ride which YOU gave them. It's assumed that they budget for this but also assumed that if that budget isn't used here then it can be used elsewhere, right? Were you billing them? No... your mistake your loss. I am certain that they would be happy to start paying and perhaps willing to pay "this" years budget assuming they still have it. Like I said, I am not an accountant, but I know right from wrong and how customer service works.

GOLFaaS

Politicker

Sales Leader

Been in this situation far too often when my teams would pick up new areas and be like. What the fuck. Did anyone look at this lol. Just go to them say sorry. Ask for payment. More often than not it was a mistake on both ends and they pay. Especially if they got value out of it while the skated for free.

LMHandle7

Executive

Sales Director

Ask the current contact if they are still using the product/service and if they are happy with it, then base your response on the feedback received, this happened to me at an earlier role, they might be using a competitor since then. If the contact(s) is/are NLE then most likely your product/service was not used for an extended amount of time..

Director

I know the post was not meant to be funny but I can't stop laughing. Good luck trying to collect if that will be even tried. Take the Loss and the CEO should take to the wood shed the VP of Strategy since they were the last contact point.

LeadMachine

Big Shot

Sr. BDR

Reminds me of that George Carlin joke, about being a good sport...

LeadMachine

Big Shot

Sr. BDR

Maybe refrain from starting off letter with invoice "You filthy no good freeloading pikers,..." I still hold out hope that this intro letter works with the exact, right client,...some day!!!

balbazar

Opinionated

Enterprise Account Executive

Honestly it's great leverage to negotiate a new contract and score an upsell. You come off like the good guy taking care of them and then look good to your team for scoring an increase.

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TennisandSales

Customer hasnt paid us for 3 years.....

How would you advise the CEO to handle this?

34 comments

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