Debt Recovery

Receiving payments from clients is a crucial part of creating and maintaining positive cash flow in any business. However, a business income stream can quickly get out of balance when clients – whom you’ve delivered top-notch work in a timely and professional manner – decide not to pay their invoices.

When clients cannot settle their accounts, the business makes less profit, incurs losses and may even have to raise prices to break even. If there are too many delinquent accounts, reaching your break-even point might become a struggle.

Unfortunately, when most clients are having financial trouble they most likely will not disclose this fact to the companies they are doing business with. Instead, they just refrain from paying their invoices. In this article, I’ve put together a list of 12 telltale signs that your client is under financial distress.

1. There’s no contract in place.

It is pertinent to have a contract in place when working with clients. A contract is a binding agreement that holds the client liable to pay all funds they owe a business. Furthermore, a contract is advantageous should you decide to take legal action against non-paying clients.

2. The Client wants to use checks as its sole payment method.

For a business, accepting multiple types of payments is beneficial and aids in getting paid faster. Companies should, therefore, be wary of clients who demand to use checks as their sole means of payment. Paper checks give clients who had no intention of settling their account leeway to be fraudulent since paper checks allow clients to establish their grace period or keep writing bad checks. This means that you will probably never receive your money.

3. Inconsistent payments and deadline extensions.

One of the most obvious signs that your client is having financial trouble is that their payments become inconsistent and they are constantly asking for deadline extensions. You may find that you are starting to receive only part of the payment of your invoices on one date and the remaining parts on another date. This is usually a clear sign that your client is having financial trouble.

4. The company is becoming contentious.

Healthy cash flow is what keeps every company afloat. Clients who are experiencing financial stress will do anything to survive, including becoming contentious. They might look for any excuse to not pay up or complain about your service for no reason at all. In actuality what they’re trying to do is delaying payment or even completely avoid payment to ease their financial stress.

5. Fishy contact information or becomes unreachable.

Perhaps the worst type of non-paying clients is the crooks whose intentions were to not pay you from the start. These are the types with unprofessional or spammy looking email addresses or are constantly changing numbers to become unreachable to people they owe. 

6. The checks keep bouncing and changing banks.

One surefire red flag is when clients keep changing banks, and their checks keep bouncing. It is not unheard of that a check sent by a client bounced or that they switched bank once in a while, however, if that keeps occurring it is a good indication that they are in financial trouble and cannot settle the account.

7. No accounts payable contact person or department.

If your client is a solopreneur or small business, they probably don’t have an accounts payable department. This can be a concern since your bill can become a low priority to them. It is therefore always best to make sure you’re dealing with a real company that will not sway from paying their bills on time by having an ironclad contract on hand.

8. Profits are plummeting or layoffs.

For a company to survive long term, it needs to be profitable, thus you need to keep a watchful eye on your client’s profit margin. This can be difficult to spot, but one surefire way to tell is if the company is constantly laying off staff. You can also look for other evidence such as the profit-margin ratios of what might be happening to profits to get a glimpse of your client’s profit margin.

9. Declining reputation or a bad news/scandal in the company.

How many big names and long-established businesses have we’ve seen fall because of a bad reputation, continuing bad press or a damning scandal in the company. Nowadays people no longer share their displeasure with a customer service department; they vent on social media for thousands to see. Bad press and scandals will tremendously affect a company’s reputation. As a result market shares can decline, which will lead to financial difficulties and the increased risk that they won’t be able to pay invoices on time.

10. Making repeated and inconsistent excuses

If you have a client that repeatedly makes excuses and is constantly asking to extend the deadline, then there’s a good chance that they’re experiencing financial troubles. It is best to stop working with this client immediately.

Key points to keep in mind to ensure that your invoices are paid

To ensure that your invoices are paid, there are three key points you should keep in mind at all times:

1. Be selective about your clients: before you start working with a client, it is always best to do a background check to spare yourself the unnecessary headache if it turns out that the client is experiencing financial distress.
2. Always request a percentage upfront: One way to vet your clients is by requesting to receive a percentage of the payment upfront. Most companies that are financially stable won’t object to this request.
3. Take legal action: If all else fails and your client still turns out to dodge what they owe you, You can always take legal action.

Conclusion:

When working with clients, your priority is to get paid as much as you can as quickly as possible. Check the above-mentioned list to find out if a company is experiencing financial trouble or not. Remember, sometimes, taking a reduced amount now could be a better option than hanging on for full payment later, which never arrives.

Accounts receivables (AR) are the lifeblood of your company. They are the positive end of the cash flow cycle and are necessary for paying bills, salaries, and your own creditors.  It also tends to be one of the largest assets a company owns.

Managing your AR effectively can help smooth out your finances and keep your company healthy and growing. However, there are a number of issues that can prevent your accounting department from collecting outstanding receivables properly.

The overarching problem that all AR teams face is accounts that don’t pay on time or don’t pay at all. But this is frequently a symptom of more specific, underlying problems in the management of your accounts receivables. Fixing these common problems will often lead to more consistent payments.

When attempting to fix any of the problems below, it’s important to remember that any solution must be applied consistently in order to be effective. Selectively applying policies or only following best practices when it’s convenient is a surefire way to fail.

Collecting On Invoices Takes Too Much Time

If your AR management team finds they spend too much time chasing down customers and helping them make payments, you may have a couple of issues that can be improved.

For one, it’s possible that you aren’t offering enough ways for your customers to pay you. If the limited payment methods you accept don’t align with the ways your customers want to pay, you’re certain to encounter problems.

So make sure you offer the full complement of payment methods available today, including credit cards, checks, direct bank account debits, digital services like PayPal, and mobile payment apps like Venmo.

You also want to collect payments digitally, and automatically, so that your AR teams don’t need to be involved. Embedding payment options directly inside of a digital invoice is the best way to handle this. Additionally, this makes things simple for your customers, which increases the speed with which they’ll pay.

Customers Complain They Aren’t Given Enough Time

Many companies pay their invoices at specific times each month. If they pay twice a month, they might choose the 15th and the end of the month. Payments made once a month could fall at the beginning, middle or end, and this date can be different from customer to customer.

The problem faced here is that your invoice releases may not align well with their schedule. Your terms might be Net 30, but if you send an invoice on the 20th and the customer pays at the end of the month, they may feel they only have ten days to pay you. If they opt to pay you at the end of the next month, they’ll wind up paying late. You may even decide to impose a late fee.

While it’s unreasonable for customers to think you can sync your invoices to their preferred payment window, you can help them by sending out invoices as soon as possible. Accounting software will generally help you automate the creation and sending of invoices, but you can also create an internal process that generates the invoice immediately upon delivery of the product or service.

Sending invoices digitally helps this situation by making invoices quicker and easier to submit and it saves them time, rather than waiting for the postal mail to arrive.

Getting Payments and Invoices to Match is Time Consuming

If you’re still manually matching payments to invoices, you’re wasting a lot of effort. Most advanced accounting packages can handle this labor-intensive task for you

Particularly when you invoice digitally and include direct access to a payment portal, you can control the flow of information between the payment source and your accounting software. This can help assure that each payment that’s made is tied to a specific invoice number for easy matching.

If you aren’t ready to automate your process digitally, there are still steps you can take. Make certain that every customer has a unique customer ID and tie that ID into your invoicing system, creating an invoice number for each invoice you send. Your invoice number might include the year, the client ID, and then a string of numbers that increments by one with each invoice. For example, the first invoice for your customer ABC Tech might read, 19ABC0001.

Make sure that clients include that invoice number with any payments they make. You’ll be able to immediately identify the account the payment belongs to and track down the matching invoice.

Invoices Missing Information

Some large companies require specific pieces of information on the invoices they receive, and when it’s missing or misformatted, payment delays can result.

For small businesses, it can be extremely challenging to generate custom invoices this way. Not only is it difficult to remember the specifics for each invoice version, but it’s also hard to keep multiple versions of your invoices on hand.

Invoicing software is the best way to solve this problem. You can create invoice templates that are specific to each customer that requires custom invoices. This way you do the work once and then rely on the software to keep everything straight for you.

Invoices Aren’t Getting to the Right People

Employees come and go. Businesses move locations. Departments shift between offices. Over time, the people, places and email addresses you’re sending your invoices to may change, and invoices that once got paid quickly might stop getting paid at all.

Using a CRM package to keep track of all of your customers can be a good way to make certain your contact information is kept up to date. These have tools built-in to help you keep up with the right decision-makers and billing contacts for each company you do business with.

Delinquent Accounts

No matter how good your invoicing practices are, some customers will always pay late. It’s likely that they’re exercising cash flow management on their end. But they might also be serious defaulters. The best way to deal with these customers is to build reminder automation into your collections process.

Either schedule reminder letters to be sent for each invoice you send, or better, create rules in your accounting software to send these letters at regular intervals for you. You can sculpt the language of the letters ahead of time. Just make certain that the reminders start out friendly and get progressively more demanding with each iteration. At some point, you need to decide whether severing the relationship with your client is better than the loss that they are causing. Always involve a debt collection agency if your bills are 90 days past due and recover money in a legal complaint way.

Phone calls are certainly warranted if an invoice becomes significantly overdue, but the more that you can leave your collections to your software, the more time you’ll have to solve other AR problems you’re facing.

If you need a Collection Agency to help you recover money from overdue accounts: Contact us

Ambulance & EMS Debt Recovery: Recovering Revenue Without Compromising Community Trust. 

For EMS directors and municipal leaders, every siren represents a life-saving mission, but the financial “after-care” is increasingly a crisis of its own. In 2026, the gap between what it costs to roll a truck and what insurance actually pays has reached a critical breaking point.

Critical Warning: Emergency and ambulance services must act quickly to collect unpaid medical bills from patients as their financial condition can deteriorate very quickly following a medical crisis. When a household is hit with sudden, high-cost medical bills, the first 60 days are the “Golden Window” for recovery before competing debts and financial instability make collection very complicated.

Nexa provides 100% reputation-safe, equipped with all 50-state collections license, offering free credit reporting, free litigation, free bankruptcy scrubs, and zero onboarding fees. Secure – SOC 2 Type II & HIPAA compliant. Over 2,000 online reviews rate us 4.85 out of 5. 

Need a Collection Agency? Restore Your EMS Cash Flow Today

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The EMS Financial Reality (Industry Stats)

The “Ambulance Profit Gap” has widened significantly this year. According to the latest 2026 CMS Ground Ambulance Data (GADCS) and industry benchmarks:

• $1,526 Under-Reimbursement: On average, across all payers, ambulance agencies are under-reimbursed by over $1,500 per transport compared to the actual cost of readiness.

• $2,672 vs. $1,147: While the mean cost of a governmental ambulance transport has surged to $2,672, the mean reimbursement across all payers remains stuck near $1,147.

• 37% Emergency Fragility: Recent Federal Reserve data shows that nearly 37% of adults cannot afford a $400 emergency expense. Since the average ambulance bill exceeds $1,200, patients move into financial distress almost immediately.

• 45% Recovery Drop-off: If a patient balance isn’t addressed within the first 120 days, the likelihood of recovery drops by nearly half as patients deprioritize “one-time” emergency costs behind recurring monthly bills like rent and utilities.

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The Nexa 4-Step “Rescue” Ladder

We separate “slow payers” from “bad debt” to maximize your recovery while protecting your department’s community image.

Step 1: The Account Reconciliation (Fixed Fee – $15)

Ideal for accounts 60–90 days past due. Because patients’ financial conditions deteriorate so quickly, this “soft touch” reminder acts as a firm nudge to pay while they still have the liquidity.

• The Result: The patient pays you directly. You keep 100% of the money.
  

Steps 2–4: Specialized Medical Mediation (Contingency)

For aged debt or patients who have “ghosted” your internal team. Our mediators use advanced skip-tracing and empathy-based negotiation to find solutions before the patient faces bankruptcy.

• The Result: You only pay us if we recover your funds. No Recovery = No Fee.

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Navigating the Regulatory Landscape

Ambulance collections are a legal minefield. Nexa is hard-coded for 2026 compliance with the newest state laws:

• Oregon (HB 3243): Effective January 1, 2026, ground ambulances are prohibited from balance billing enrollees for more than the in-network cost-sharing amount.

• Utah (HB 301): New 2025/2026 laws codify base rates and strictly prohibit ground ambulance providers from charging rates that exceed established caps.

• Illinois (SB 2405): As of July 2025, non-participating ground ambulance providers must ensure enrollees incur no greater out-of-pocket costs than if the service were in-network.

• New Hampshire (SB 245): Effective January 1, 2026, this law officially bans “balance billing” for ambulance rides. It also sets mandatory rates for how much companies can charge insurers, significantly changing the negotiation landscape for EMS providers.

• California (AB 716) – The 12-Month Rule: While active since 2024, California’s law has a strict provision that creditors must know: You are prohibited from reporting adverse information to a credit agency or starting civil action against a patient for a minimum of 12 months after the initial billing. Nexa’s systems are pre-set to respect this “cool-down” period.

• Maine (LD 1290): Maine now prohibits balance billing for all covered emergency and non-emergency ground ambulance transports. If no local rate is set, the law caps reimbursement at the lesser of 325% of Medicare or the billed charge, requiring precise coding to ensure you don’t over-bill and trigger a violation.

• Texas (SB 2476): Since early 2024, Texas has banned balance billing for ground ambulance trips. However, in 2026, the focus has shifted to the Independent Dispute Resolution (IDR) portal. If a health plan underpays, we help you navigate the state-mandated mediation and arbitration process to secure the “just and reasonable” rate.

• Washington State: The Balance Billing Protection Act has been expanded to include ground ambulances. It requires providers to bill health plans directly and strictly prohibits asking patients to “waive” their protections—a common mistake that can lead to heavy state fines.

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Recent EMS Recovery Results

• Private Ambulance Provider (FL): Recovered $280,000 in aged patient balances (120+ days) in just one quarter.

• Municipal EMS Department (TX): Used our Step 1 Fixed-Fee service to recover $42,000 in “small balance” co-pays that had been sitting idle for six months.

• NEMT Provider (CA): Reduced overall DSO (Days Sales Outstanding) by 32% within the first 6 months.

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Frequently Asked Questions (FAQ)

1. Why the urgency?

Patients often experience a “vicious cycle” of financial deterioration after an emergency. If you don’t collect within the first few months, you are often competing with hospital bills, lost wages, and other post-crisis expenses.

2. How do you handle patients with “Insurance Denials”?

We identify if the issue is a simple “claim denial.” Often, we can point the patient back to their carrier to resolve the underlying issue, resulting in your bill being paid by the insurer rather than the patient.

3. What about “Indigent” patients?

We perform “ability-to-pay” scrubs. If a patient is truly insolvent, we provide you with that data so you can accurately classify the debt as “Charity Care” rather than wasting resources.

Need a Collection Agency for unpaid EMS Service bills? Serving Nationwide: Contact us

 

Supply Chains Are Moving. Don’t Let Your Cash Flow Stall.

In the manufacturing sector, “Net 30” is rarely Net 30 anymore. With supply chain disruptions and rising material costs, clients are treating your invoices like interest-free loans.

You aren’t just selling a product; you are financing the raw materials, the labor, and the machine time. When a client delays a $50,000 payment, they are freezing your ability to restock inventory or repair a critical CNC machine.

The “Goodwill” Trap in B2B Collections

Manufacturers often hesitate to collect because of “the relationship.” You worry that a collection letter will offend a long-term distributor or jeopardizing a future contract.

• The Reality: A client who values the relationship pays you on time. A client who ghosts you is managing their cash flow at your expense.

Nexa specializes in B2B Manufacturing Debt Recovery. We understand the difference between a disputed custom order and a simple refusal to pay. We help you enforce your terms without destroying your supply chain relationships.

The “Zero-Interest” Loan You Didn’t Approve

According to 2025 industry data, the average Days Sales Outstanding (DSO) in manufacturing has crept up to 56 days.

• The Cost: If you operate on a 10% margin, a $20,000 bad debt requires you to generate $200,000 in new sales just to break even.

• The Fix: You cannot afford to out-sell bad debt. You must collect it.

Why Nexa is the CFO’s Choice:

• We Speak “UCC”: We understand the leverage of Uniform Commercial Code (UCC-1) filings and how to use them to secure your position against other creditors.

• Early Intervention: Our Step 2 Flat-Fee Service ($15/account) is perfect for early-stage delinquency (45-60 days). It sends a professional “shot across the bow” that prioritizes your invoice over others.

• Protect Your Name: We know your reputation in the industry is vital. Our agents (rated 4.85/5.0) act as professional mediators, not “junkyard dogs.”

A Recovery Workflow Built for Industry

We don’t treat a B2B manufacturing debt like a medical bill. Our process is designed for corporate finance departments.

Phase 1: The “Distributor Nudge” (Early Intervention)

• Best For: Long-term clients who are “slow-walking” payments or claiming “check run” delays.

• The Strategy: We deploy Step 2 (Flat-Fee). We send official third-party demands that reference your PO numbers and invoice dates. This signals that the account has been escalated to a professional firm.

• The Result: The client’s AP department flags your invoice for immediate payment to avoid a credit mark. You keep 100% of the money. This is why we emphasize: Place accounts earlier (Day 60-90) for maximum recovery.

Phase 2: The “Contract Enforcement” (Late Stage)

• Best For: Clients who have gone silent, custom order disputes, or companies showing signs of insolvency.

• The Strategy: We move to Step 3 (Contingency). We use commercial skip-tracing to find the owners. We report the commercial debt to credit bureaus (Experian Business, Dun & Bradstreet), which threatens their ability to get financing elsewhere.

• The Result: We leverage the threat of credit damage or legal action to force a settlement. We charge 20%-40%, but only if we succeed.

Real World Results: Recovering Industrial Revenue

Scenario A: The Custom Fabricator (Metalworks)

• The Issue: A metal fabrication shop produced a $35,000 custom order for an automotive supplier. The supplier accepted the goods but stalled payment for 120 days, citing “cash flow tightness.”

• The Fix: We ran a Litigious Check and found the supplier had pending lawsuits from other vendors. We moved immediately to Step 3, serving a demand that threatened a UCC lien enforcement.

• The Outcome: The supplier, fearing a freeze on their own credit lines, wired the full balance within 5 business days.

Scenario B: The Food Processor (Packaging)

• The Issue: A packaging manufacturer was owed $12,000 by a regional food brand. The brand claimed “quality issues” only after the invoice was 90 days past due—a common stalling tactic.

• The Fix: We requested the signed Proof of Delivery (POD) and the initial QC acceptance report. We sent these with a formal legal demand letter.

• The Outcome: Faced with documented proof that destroyed their dispute, the debtor agreed to a 3-month payment plan. The manufacturer recovered the funds and kept the client on “Pre-Pay” terms for future orders.

FAQ: B2B Debt Recovery

Q: Will sending a client to collections ruin the relationship?

A: Paradoxically, it often saves it. Financial ambiguity ruins relationships. By professionally enforcing your terms, you reset the dynamic. Once the debt is paid, you can resume business on clear terms (e.g., credit limits or deposits).

Q: Can you help if the debtor is in another state?

A: Yes. Manufacturing supply chains are global. We are licensed in all 50 states, so if you are in Ohio but your debtor is in Texas, we can pursue them seamlessly.

Q: What if they have filed for Bankruptcy?

A: We offer a Free Bankruptcy Check before we start. If they have already filed, we will advise you on whether to file a Proof of Claim or write it off, saving you time and legal fees.

Stop Financing Your Customers

Your margins are for your growth, not your client’s float. Secure your revenue with a partner that understands the mechanics of manufacturing debt.

Click here to Contact Us and start your recovery campaign.

 

The challenges that businesses face are numerous, but few are as aggravating as customers that don’t pay their bills. This violates the basic quid pro quo that commerce is founded on. You provide a product or service, and in return, your customers agree to pay for it.

When they don’t, business owners must decide whether to pursue the debts themselves or pass the job off to a third-party collection agency. Both options have their positives and negatives. This article will focus on the pros and cons of hiring a debt collector instead of doing the difficult work of collecting yourself.

Pros in Favor of Collection Agencies

Convincing delinquent accounts to settle their balances can take quite a lot of time and effort. These are the reasons why businesses should let collection agencies take the wheel.

Collection Agency is the “Bad Guy”, you are not

By involving a professional debt collector, you are not directly involved in the collections activity. You can just maintain that it is the company policy to forward accounts for collections, now things are out of your hands. They should contact the agency directly for settling the balance.  

Collection laws

Welcome to the United States, there are complex and countless laws involved in attempting to collect your own money. Collection agencies are well versed with federal and state debt collection laws therefore they minimize the risk of getting sued back by the debtor.

Debtors are far more likely to pay when a Collection Agency is involved

Debt Collectors are experts in collecting debt, after all that is what they do all day long. They have access to several tools and services to effectively and legally recover your money. Debtors understand that giving false excuses or simply relocating to a new address is ineffective with a collection agency. It is nearly impossible to match the cost and recovery rates of a collection agency.

Businesses Have Better Things to Do

You have a business to run. Time spent drafting and sending collection letters, making phone calls, and keeping track of account statuses pulls personnel away from their normal duties. Depending on the volume of potentially bad debt you’re carrying, the amount of time your business can lose is significant.

It’s certainly worth attempting to collect funds owed before they become considerably past due. But once a customer has demonstrated a reticence to pay, further efforts on your part are likely to be unsuccessful.

Moving these delinquent accounts to a collection agency allows you to focus on finding new customers and on generating new income while the agency attempts to recover funds you likely can’t.

Collection Agencies Are Better Equipped for the Job

Collection agencies have a number of tools available to them that you don’t. Plus they have the benefit of single-minded focus. They don’t have to run your business while trying to collect debts.  Collecting debt is all they do, so they’re able to dedicate themselves to the task.

If you sell widgets online, your skills lie in widget sales and online commerce. Debt collection isn’t likely something you’re trained in or something that you know how to do well. But that is the primary focus for collection agencies, and so they have a significant advantage over you when attempting to recover the delinquent debt.

You just addressed the Collection Problems that every business faces

Most companies do not have dedicated people to handle overdue accounts receivable. Your existing employees are neither effective nor organized to handle the debt collection. Hiring a collection agency will help you to address even those accounts with low balances. Regardless you have high volume of unpaid invoices or just a few accounts, a collection agency will continue to work for you. You will be better advised on accounts with severe delinquencies, litigious customers, or when the debtors are difficult to locate. Hiring a collection agency will leave your employees less frustrated since internal staff hates doing debt collection.

Collection Services Only Cost You Money If They’re Successful

Most reputable collection agencies charge using performance-based contracts. They take a percentage of any monies recovered, which means you’re not risking anything by seeking their services. If they collect nothing from your delinquent accounts, you pay them nothing.

On the other hand, if they’re successful, you’ll pay a set percentage of the total funds recovered. But these are funds you likely would not have recovered on your own, and a percentage is better than recovering nothing at all.

Although most collection agencies offer low-cost & fixed fees based Collection Letters service as well which are extremely effective and recommended for accounts less than 120 days.

Other important benefits

Collection agencies can collect debt across all 50 states, in both Spanish and English. They also have a national network of attorneys who can assist if there is a need to take the debtor to the court. They will offer several payment options to the debtor and can even place the account to be paid off in installments. 

Cons Against Collection Agencies

Like any business, collection agencies aren’t right for every customer. Here are a few things to keep in mind when considering whether to hire a debt collector.

They Aren’t Cheap

Collection agencies charge a fairly high percentage for their services, often between 25% and 50% of the funds recovered, depending on the type of debt. But this is to be expected.

Delinquent debtors are typically transferred to a Collection Agency after 90 days of non-payment and the possibility of recovering anything from these accounts through the efforts of in-house employees is nearly zero. Money collected through collection agencies is cash you may have not got otherwise. 

Even with their expertise, a large amount of debt remains unrecoverable without invoking severe, and expensive legal actions. So collection agencies must support their businesses with the funds they are able to recover. It’s important to remember that without the help of a collection agency nearly all delinquent debt remains unrecoverable. Paying 50% on recovered funds is better than the alternative.

Federal laws restrict what a Collection Agency can do 

There are many debt collection laws applicable when Collection Agencies are trying to recover money from a debtor. A simple example is  “30-day” dispute period during which a debtor can tell a collection agency to prove he indeed owes the debt, or stop contacting him. The dispute period does not apply to the original creditor. Many states put original creditor and collection agency in the same bucket, which means the collection laws apply to either one trying to recover money from the debtor.

Slightly Higher Possibility of Sour Customer Relationships

Some customers just get agitated due to the mere fact that the account has been transferred to a collection agency when they themself have failed to fulfill the payment obligation despite your repeated efforts and reminders from your in-house accounting/receivables department. Do you even bother so much anyway to maintain a good relationship with these customers?

If you choose a collection agency that’s overly aggressive or one that employs unsavory methods for collecting on your accounts, those customers affected will likely think ill of you by the end of the process.

This is less than ideal because many customer accounts become delinquent due to circumstances out of your customer’s control. They often want to pay, but can’t. When their financial situations improve they could revert to being good, paying customers. But this is less likely to happen if a bad collection agency ruins the relationship.

Hire a Trustworthy, Well-Reviewed Agency

The negatives associated with collection agencies can be avoided by checking references and reviews for the agencies you’re considering to find one that employs industry best-practices, works to maintain healthy customer relationships, and take a fair percentage in exchange for their services.

The unfortunate reality is that attempting to collect delinquent accounts on your own is likely to net you nothing but heartache and wasted time. Trusting these accounts to an esteemed collection agency significantly improves your chances of recovering funds, and something is always better than nothing.

If you need a cost-effective collection agency that utilizes an amicable, diplomatic yet firm approach to recover your money then Contact us.

If your business has been writing off bad debts without involving a Collection Agency, you might be leaving significant revenue on the table.

Many business owners believe that once a debt is “written off” for tax purposes, it is gone forever. This is a myth. A “write-off” is usually just an accounting entry to clear your books. Unless you have legally “forgiven” the debt in writing to the customer, they still owe you money, and you still have the right to collect it.

Here are the 8 most common reasons small businesses prematurely write off debt—and why you should reconsider.

1. “We’ve never used an agency before.”

The Fear: You are unsure what a Collection Agency actually does or if it’s worth the effort.

The Fact: You need to hire a professional to see the difference. A collection agency acts as an extension of your back office, immediately improving your cash flow by applying professional, consistent pressure that internal staff simply cannot replicate.

2. “It seems like too much hassle.”

The Fear: You think onboarding an agency involves complex paperwork and software integration.

The Fact: Modern collection agencies take the stress off your plate. We accept accounts via simple online portals or spreadsheets. Once you hand it over, we do the work. Your in-house employees cannot match the efficiency and recovery rates of a dedicated team equipped with skip-tracing tools and legal expertise.

3. “We’ll just make up the loss with new sales.”

The Fear: You accept the loss and try to offset it by getting new orders.

The Fact: This is dangerous math. If you have a 10% profit margin and write off a $1,000 debt, you don’t need $1,000 in new sales to break even—you need $10,000 in new sales just to recover that one loss. Recovering the cash you already earned is far more profitable than chasing new clients.

4. “Management won’t approve it.”

The Fear: Accounting and Receivables departments often struggle to convince Owners or CFOs to change company policy and assign accounts over 90 days past due.

The Fact: Cash flow is the lifeblood of a business. Management needs to understand that holding onto old debt doesn’t save money; it costs money in inflation and administrative time. (See our guide: Is Management Ready to Hire a Collections Agency?)

5. “We don’t know who to trust.”

The Fear: Choosing the wrong partner feels risky.

The Fact: Nexa Collections specializes in ethical, effective recovery. We are transparent about our methods and results. You don’t need to search endlessly; we are ready to help you today.

Need a Collection Agency? Contact us

6. “The commission fees are too high.”

The Fear: Since agencies charge contingency fees (a percentage of what is collected), owners are reluctant to “share” the money.

The Fact: Ask yourself: Would you rather have 100% of nothing, or 60% of something? Many businesses sit on these accounts until they become legally uncollectible (Statute of Limitations), resulting in a 100% loss. No agency recovers every dollar, but we will recover significantly more than zero, which is what you get if you do nothing.

7. “We don’t know when to send the account.”

The Fear: Waiting too long or acting too fast.

The Fact: The earlier you transfer, the better.

• Best Practice: Transfer accounts after 60–90 days of non-payment.

• Acceptable: Accounts under 1 year old are still very collectible.

• Too Late: Accounts older than 3 years generally result in low recovery rates.

8. “It will ruin our reputation.”

The Fear: A Collection Agency will spoil the business relationship with customers. The Fact: This is the biggest myth of all. Professional agencies pursue a diplomatic, amicable, yet firm approach. We cannot threaten or harass; it is against federal FDCPA laws. We work with the debtor to find a solution (like a payment plan) rather than working against them. Our goal is to recover your money while preserving the relationship for future business.

The Bottom Line: It’s Not Too Late

To attempt the recovery of bad debts previously written off, they should be assigned to a collection agency without further delay. As long as the debt is within the Statute of Limitations for your state, there is still hope.

Don’t let your hard-earned revenue vanish.