Looking for a source of improvement – outsourcing to Account Collections!
- Comments off
I am always amazed to hear potential clients tell me they don’t outsource their past due date accounts. It’s amazing, because in Account Collection’s engagement of cases, it doesn’t cost anything to place aged receivables with us as a collections agency.
So there’s the number 1 reason: You have nothing to lose and everything to gain!
Did you know? Once a debt is placed with an agency a letter goes out which puts the debtor on notice. They are informed that they have xx days to cure the debt or risk having the debt reflected on their credit report. During that window is often where the debt is correctly acknowledged and the debt gets paid. The customer realises they cannot put the debt off any longer and settle.
Here’s the number 2 reason: Account Collections will often have the leverage of “damaged credit” on their side. This will result in payments!
Collections agency place a fresh eye on your methods, policies, and major dispute issues. A good agency will give invaluable feedback regarding what your customers are saying about your invoicing, terms of trade and customer service.
So there you have the number 3 reason: Fresh perspective and a temperature gauge of your operating procedures.
I hear many business owners state they collect their own receivables. There is nothing wrong with that process; in fact it is a good practice to periodically touch base with what your customer service issues may be. On the flipside, it can be very tough for an owner to wear too many hats. Statistics show the average wage for an owner is $65 per hour and around $30 for a accounts payable employee. How about removing that cost and realising better returns on delinquent debt.
Now you have reason number 4: Save time, money, and stress by outsourcing early!
So, now let’s talk about your resources. How much of your staff time could you free up if you outsourced some of the more menial and time consuming tasks?
Reason number 5: Keep headcount down, or even reduce it, by outsourcing time consuming processes.
So, if you don’t currently use a collections agency, you might consider exploring the possibilities. In most cases the time savings and the fact that instead of writing the debt off, you now have a real shot at collecting at least some of the original debt means it is going to be a great outcome for your cashflow.