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Collections are rarely something we want to talk about, but they are a significant part of any self storage business. In this Gabfocus Spotlight, Alonna Ross of StorageAuctions.com and Brian Wofford of Storage Masters discuss a topic every operator and manager has to deal with - late payments.
Question: "How do you handle a tenant who is always late?"
Check out the video clip below to hear their answers:
In this Gabfocus Session: What Now? Handling collections, auctions, and lien law, we discuss how to navigate these tricky (and personal) topics. With a clear process, straightforward communication, and diligent follow-through, you can make it easier and safer for your team and your customers.
Check out the full Session to dive deeper!
Alonna: So we have some that require if you're habitually late, you have to go on auto pay or you got to go because they're not going to keep spending their time coming after you.
It's almost like three strike rule. You're late three times. You're either an auto pay or you're out. You got to stop wasting our time.
Brian: I've dealt with quite a few of those. You even have the client that, "okay. Well, way late fee one time, but you have to go an auto pay from here on out. You can't be late anymore.
Okay, but they going to auto pay, and then every month the card doesn't clear. So they're late anyway. So what we try to do? We give everybody a warning First time, second time, we tell them if you continue to do this, we're going to ask you leave.
If you don't leave, we're going to evict you because it's just not worth our time. We'd rather have someone in there that wants to pay the bill. Luckily, we never had to evict someone and something that helped us a lot as being associated with our credit card fees.
Accept ACHs. get it to the point where you draw it straight from their account if they will allow you to the cost savings for getting ACH. Comparing to collecting 200 dollars debt from Visa or Mastercard. I mean, it's huge.
It may be as much as 3-4-5 dollars difference. So you run ACH, maybe it runs you a quarter. You run a 200 dollars credit card. Maybe it runs you two and half of that 200 dollars