Focus on your Core Business and Allow a Professional Debt Collection Agency to Help with your Past Due Receivables
Whether your company is growing because of new business or your workload is just growing due to the “great resignation”, it seems that many of us are doing more with less. Free up the time you need to focus on what’s most important by hiring an outside collection agency to assist with your company’s past-due accounts.
Unlike the many responsibilities of your internal finance and credit teams, debt collection agency personnel have just one goal – to recover past due accounts. An agency’s training, technology, and resources are centered around contacting debtors and collecting the money that is owed to their clients.
It can be expensive to hold onto overdue receivables, and your team doesn’t likely have the time needed for effective debt collection efforts. Using a commercial debt collection agency can ensure your accounts are given the attention they need for successful debt recovery.
Commercial debt collection agencies understand that a company’s debt collection needs may differ from that of another business. As a result, there can be variations in best practices depending on the company’s industry. Many B2B collection agencies offer a variety of services that can be customized to a business’s needs.
These services usually include first-party accounts receivable management (also known as collections outsourcing), traditional third-party collections, international debt collection, and legal services from amicable efforts through litigation.
Worthy collection agency partners will not only keep detailed records of any and all contact they have had with your past due customers, but most will also have an online portal for their clients to view real-time account activity at their leisure.
These client portals provide a complete history of the collection efforts taken on your accounts. Should it be determined that legal action needs to be taken against your customer, or if you decide to file a claim(s) as bad debt, this backup documentation will be critical to prove your case and to verify that proper due diligence was put forth to obtain payment.
Third-party debt collection agencies also have access to a wide variety of tools and credit industry resources to help make the debt recovery process more efficient. For instance, when a customer severs all contact with your company—their phone is disconnected, and they have left no forwarding address—debt collection firms can help you track down that client using skip tracing.
In addition, collection agencies have access to public records databases, credit reporting devices, and other resources that can help you find a client. This way, you can obtain updated contact details and move closer to a resolution on the outstanding account.
No one wants to send a customer to collections, but despite your best efforts, some accounts will fall past due, and some customers won’t pay. Debt collection agencies may not always have a positive reputation, but by working with a certified, commercial collection firm, you can rest assured that your customers will be treated professionally.
Make no mistake, a customer will listen more closely when they’ve been told their account has been sent to collections. This effort alone indicates you are serious about your intention to collect the money owed to your business. The sense of urgency that debt collection agencies’ efforts provide generally motivates customers to act quickly to pay or settle their overdue accounts for fear of legal action.
In the US, commercial debt collection is not regulated in the same way collecting consumer debt is; however, that doesn’t mean that commercial debt collection agencies don’t have guidelines to follow. Most B2B collection firms obtain certification by the CCA of A, the IACC, or the CLLA. These are the primary, independent bodies regulating commercial debt collection. Certification ensures the agency adheres to a strict code of ethics and generally accepted accounting principles and is bonded.
There are licensing requirements in some states and countries, so ensure the agency you select is licensed where your customers are located. Agencies have to be properly insured for data protection and cybersecurity, and they must adhere to the data privacy policies where their clients’ customers are located.
Commercial collection agencies specialize in credit and accounts receivable management to the degree that they can often offer valuable resources to your company.
Through their affiliations with agency certification bodies, certified agencies have access to industry research and training opportunities that they will often share with their clients. These may include articles and posts, newsletter content, and webinars. And from working on your accounts, they can offer professional expertise to help you implement strategies to increase cash flow and reduce bad debt.
For more information on how our commercial collection agency can help your business contact us at 844.937.3268 today!