Outsourcing your overdue accounts receivable to a Collections Agency will save you time, energy and money.
Outsourcing your collection activity will also reduce your stress and make you more legally compliant with all the federal debt collection laws and regulations, significantly lowering your chances of getting sued back from your debtor. Here are all the benefits of involving a collection agency versus having your in-house staff deal with past-due accounts.
- These two-letter words “Collection Agency” have a similar impact on debtors, like when you are speeding, and you see a “Cop“. You suddenly slow down and start following all the rules. When a debtor understands that your unpaid bills are being handled by a collection agency, the probability of getting paid suddenly increases.
- You cannot handle debtors excuses well enough, but Collection Agencies deal with all sort of excuses, all day long. Here is the list of most common debtor excuses.
- You do not have a subscription to the expensive services used by Collection Agencies that assist in recovering money from accounts receivable. For example, they Skip Trace every debtor to find its latest address or to know if he is bankrupt.
- Focus on your critical growth activities rather than collection activities. I guarantee that no one in your company likes to follow up again and again with debtors who are late on payments.
- Collection agencies are experts in recovering money, your in-house staff is not. Outsourcing accounts receivable to a good collection agency will maximize chances of recovery and improve your cash flow.
- Are you trying to collect money from a debtor who has a history of filing lawsuits? Collection agencies perform a “Litigious Debtor” check to minimize the litigation risk.
- Save money on labor costs because you can never beat the invoicing cost of a collection agency, which is roughly $15 for 5 diplomatically crafted yet firmly written collection letters. They include various scrubs and tons of other checks.
- If you prefer using only the contingency-based “Collector Calls” service, go for it. You do not need to spend a penny from your pocket, if the collection agency recovers money, only then they get to keep a smaller portion of the amount recovered.
- Faster you transmit your accounts receivable to a collection agency, higher the chances are to recover money. Chances of collecting money from a 90-day old debt are way higher versus waiting for nine months and then transferring.
- There are many federal and state laws on how the money can be collected from debtors, failing to follow those can be very risky and costly. Collection agencies train their staff regularly on these rules and regulations.
- Collection agencies can accept payments online and in many other forms, lot more ways than your office can accept money. They can also negotiate with the debtor to pay in installments if required.
- Most collection agencies are so confident of their service that they will offer a written guarantee for their Letters Service, else they refund most of your money back.
- Agencies can report unpaid accounts to credit reporting agencies like Equifax, Transunion and Experian.
- Collection agencies have staff who can perform collection activity in both English and Spanish. Can your own staff do that?
- They can also file a legal suit to collect money from the hardest accounts, while you remain stress-free.
- Collection agencies sometimes check the credit history report to verify the credit-worthiness of your debtor, to determine if they will pay soon enough or not.
- Haven’t tried outsourcing accounts receivable yet, or your collection agency is not up to the mark? Contact us, and you will be connected with a collection agency with low contingency rates and recovery rates far above the industry average, at no cost to you.
- Your in-house staff must be very frustrated making reminder calls and sending invoices again and again. If you outsource accounts receivable to an external collection agency, it will allow them to focus on the core responsibilities of your business.
You can contact us to outsource accounts receivable to a Collection Agency.