When gym members fail to pay their dues, your gym can take certain steps to encourage payment. If these fail, it’s time to consider third-party collections, which provides a degree of separation between your gym and further discussions of money.
At Aldous, we provide collections services after 90 days to reach your members through our law office. Our process helps gyms retain members rather than driving them away, and is effective at obtaining payments. Here’s more info on working with us to ensure the collections process is as fruitful as possible.
When a member fails to pay, the next steps should be carried out by your gym. It’s also helpful for your gym to take steps all along in preparation for failures to pay.
Your gym should do these things:
- Have Good Processes: When members first sign up at the gym, gather good contact information for them. This way, we have ways to contact them if they go past due. Also, have a clear-cut collections process that you put into place when a member fails to pay, starting with steps your gym takes and working up to sending to collections if necessary.
- Communicate: Make the collections process transparent to members so they know what to expect from the start. Then, follow the steps of a process to communicate with members before they go to collections. Give them chances and reminders to pay your gym directly; if they fail to do so, warn them when they are about to go to collections.
- Review: Double-check the collections list before it is sent to us to ensure everyone on the list really owes dues and needs to be in collections. It’s also helpful to check contact information.
- Resolve: If someone contacts you directly to pay, resolve with them right then instead of sending them to the collection agency. Chances are, they will forget to contact collections, and our policies allow for this to make it easy for you to work directly with members.
We recommend sending members to third-party collections after they have failed to pay for 90 days. At that point, there are effective steps we can take.
Aldous does these things:
- Contact in Multiple Ways: Our process includes multiple steps. We email, call and send letters to members who have failed to pay dues and have been sent to our collections process. Communicating in numerous ways gets attention, adds legitimacy to our requests, and communicates with everyone in the way they most prefer to communicate. This method improves our success rate, as people may not respond to some methods but will respond to others.
- Report on Credit: We warn members that a failure to pay will lead to a report on their credit, which has a negative impact on their financial situation. We have found that credit reporting increases the success of collections by 20 to 25 percent.
- Legitimacy: At Aldous, we operate our collections services out of our law office, which catches people’s attention more than a collection agency. Working as a law office adds legitimacy to our requests and creates a greater sense of consequence to a failure to pay. People in collections are often contacted by multiple agencies, but when they receive communication from a law office it catches their attention and becomes a higher priority.
We can work together to ensure your gym is able to collect as much outstanding debt as possible. Not only that, but following these methods can help your gym retain members rather than losing them.