Recently, I was surprised to learn of a customer with accounts that had been cut off for non-payment who were still off for non-payment when the cut-off list for the following month was being prepared.

How long do you wait before closing cut-off accounts?

Have they skipped out?

Experience shows that customers who don’t pay (or try to make arrangements) within the first day or two of being cut-off generally aren’t going to pay and probably are no longer living there. If your customer has skipped out on you, why wait to close the account and apply their deposit?

Waiting a few days to close the account, in case your customer is out of town, makes sense. But certainly a month is much too long to wait.

Code violations

In some localities, a residence without running water is considered uninhabitable and poses a building code violation. If this is the case in your jurisdiction, be sure you follow all local ordinances concerning cut-offs and reporting requirements if it appears someone is still living there after being cut off.

Charge a higher deposit

If they do come back to have their service restored after you’ve closed their account, be sure to charge an adequate security deposit. If you have a variable deposit policy, based on the customer’s credit, they should pay your maximum deposit after being cut off for non-payment.

Quick poll

How many days after cut-off do you wait before closing accounts that haven’t paid? Take this quick poll and see how your utility compares to others.

Is it time to review your cut-off policy?

Has it been a while since you’ve reviewed your cut-off policy? Please give me a call at 919-232-2320 or e-mail me at gsanders@logicssolutions.com to learn more about how a business review could assist with reviewing your policies and procedures.

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© 2014 Gary Sanders