Unfortunately, debt collection has become a pervasive part of the corporate world, especially for the Americans. Considering that 70 million Americans were contacted for a debt collection in the year 2016-17 (as estimated by CFPB), piling debts are definitely becoming a major problem for businesses around the globe.
If you are here, reading this, I am sure you have also considered hiring a debt collection agency but turned your back due to some challenges along the way. The reason why I am here today. Let’s discuss them one by one:
You think your debt is too small
Too big or too small are very subjective terms. For instance, a debt of 1000 USD is too small for a company like Apple, but for a startup, it can be a make-or-break figure. The bottom line is if it is affecting you, your business, and your cash flow, it matters.
Now, if you think that debt collection agencies won’t consider you for your small figure, that’s not how it goes. In fact, many debt collection agencies have principles and policies, that state no debt is too small or too large.
If you chase the debt all by yourself, most of the time it proves to be very exhausting, both in terms of effort and resources. Hiring a third-party collection agency whose primary work course is recovering debts reduces your expenditure and grants expert services.
The process is too time-consuming
Think about it for a moment: You are chasing the debt, scheduling regular follow-ups and draining both money and time (days, weeks and sometimes months), how do you think it’s going to pay off? After all this, even if you recover the debt, will it be worth it? No!
This is where the debt collection agency steps in with all the expertise and years of experience. They are professionals and will jump straight into the situation, picking up right where you left. The groundwork to handover your debt to an ‘outsider’ is practically nil. Other than saving time, you are getting to do what you do best without getting distracted, your business.
Debt Collectors are very expensive
Anything that serves you benefits worth multiple times more than what you have actually spent, is an investment – not an expenditure. And so is debt collectors.
Well, if you want to see whether they are not worth it or not, it is best advised to calculate how much you are willing to invest to see the late payment coming. Reputable third-party collectors don’t charge any hidden fees and run a free analysis on your debts before taking the job.
In fact, most of the debt collection agencies operate on a commission basis, instead of charging a flat fee. Commissions imply that they will be liable to a certain percentage of the recovered amount. To your benefit, many agencies follow the policy of ‘no recovery, no payment’, which means you don’t have them anything if the amount is not recovered.
Now ask yourself, once again, are they really expensive?
Debt collectors will harass your clients
I understand you are scared to risk the trust that you have earned after years of operation in the industry. But, if you pick a reputable debt collector agency, this wouldn’t be a concern anymore.
Expert debt collection agencies have tip-notch =communication skills that walk the thin line of being assertive and proactive. They are well versed with the techniques to pitch your debtor, ensuring high recovery rates.
Outsourcing debt collection to a third party will also shield your customers from handling troublesome situations from problematic clients. Apart from that, it will also preserve your business’ integrity in the eye of the debtors.
You think you don’t need a debt collector
You need to understand, as the time passes, the less likely it is that your unpaid debt can be recovered. Once the due date is reached, with every passing day you will receive a reduced amount from the actual figure.
So if your calls are unanswered for quite some time now, it’s time you should contact a debt collector agency. A letter followed by no response in the first week is more often than not will remain unanswered in the third week also. Thus, it is in your best interest to hire a debt collection agency that has the required tools and taskforce, especially for debt-recovery.
Now, that you have a clear picture of the operations of debt collectors and the services offered. Start your research and pick the best debt collection agency!