Fee Collection Techniques

11/07/2007

You never change things by fighting the existing reality. To change something, build a new model.
Buckminster Fuller

In the popular Exchange book, Managing Money: A Center Director's Guidebook, members of the Exchange Panel of 300 offered strategies for dealing with the problem of late fees. Here are a few of their ideas...

Keep in close touch with all parents
Parents who are most likely to fall behind in paying fees are either those who are unhappy with the program and feel little motivation to pay their fees on time or those parents who are experiencing personal difficulties and feel uncomfortable asking for special consideration. Therefore, one of the most effective steps you can take to avoid fee delinquencies is to maintain good relationships with parents. If the director keeps in close contact with the parents, she will be able to detect signs of disgruntlement early and deal with them before they get out of hand. Likewise, if a director is on good terms with parents, they will feel more comfortable approaching her if they are in difficult straits and need to make some special arrangements on deferring fee payments.

Make it easy to pay
The more trouble parents have to go to in order to pay fees, the more likely they are to delay doing so. If fees are to be paid to the director, for example, and the director is frequently on the phone or not to be found, this will frustrate parents and result in payment lapses. Many centers have locked metal boxes with slots so that parents can drop their checks off effortlessly when they come to pick up their children. One center has a desk in its reception area so that parents can sit down and write out their checks. Other centers send out invoices with stamped return address envelopes so that all parents have to do is to slip the check in the envelope and drop it in a mail box.

Act quickly on delinquencies
Directors must be vigilant to keep overdue fees from turning into bad debts. By acting immediately when an account becomes overdue, you can often nip a problem in the bud. If you wait too long, the amount of money overdue may become so large that it is almost impossible for a family to pay it off. If you are reluctant to press parents when fees are overdue, this can also set a dangerous precedent. When people don't have enough money to pay all their bills, they tend to defer paying whatever bills they can without resistance. If they know they can pay their fee to your center a week late without any consequences, they are more likely to do so.

More Great Management Ideas!

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* The Art of Leadership: Managing Early Childhood Organizations
* Stick Your Neck Out — A Street-Smart Guide to Creating Change in Your Community and Beyond
* 250 Management Success Stories from Child Care Directors
* Exchange Article CD Collection #9: Taking Stock — Evaluation Tools for Program, Teacher, and Directors
* Exchange Article Collection #5 - Staff Supervision

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