If you’re in a product or service industry, you’ve likely faced a time when you realized your bad debt was catching up with you. At this point, you may have considered the use of a collection's agency. Maybe you were even scared to take the leap of faith? These fears may be the reason you’re missing out on the revenue that your business needs, negatively impacting your day-to-day business. In fact, a lack of funds can affect employee retention, lead to freezing critical marketing activities, and in extreme cases, can ultimately result in closing your doors permanently.
So, how can you turn aged receivables, also known as bad debt, into bottom-line revenue and ensure this never happens to your business? It’s easy.
Who can utilize, and could benefit from collections?
While anyone with aged receivables can benefit from the use of a professional collection agency, the primary industries that are typically served are the following:
- Healthcare organizations such as Hospitals, Doctors, Dentists, Eye Doctors, Veterinarians, Chiropractors, etc.
- Banks and Credit Unions
- Leasing agents
How do I know whether to use in-house collections vs. a collection agency?
If you are a large organization you likely already have a collection agent partner, or an in-house collections department. While this is often the case, it’s good to keep in mind that an outside agency is also a great resource for second placement.
In small to medium-size entities, collections activities are often conducted by a small group of people in-house. All too often, just one or two people carry the burden of in-house collections like an office manager or other business administrator. While these individuals may have a good track record of collecting on a few accounts, a small group of people can only accomplish so much.
The best collections agencies have a myriad of methods to collect, and most importantly, this falls on their ability to utilize the latest in technological advances. Unfortunately, in-house collection agencies in most small to medium-sized businesses do not have access to this technology, so collection efforts are slowed. Here a just a few examples of the hundreds of functions that the latest collections software can perform.
- Multiple account batching
- Having trouble locating a debtor? We can cross locate multiple accounts across multiple providers using our technology.
- Automated call-back scheduling
- Unattended messaging
- Online payment options including virtual agents and chatbots
What about recovery rates?
Collections agencies are successful because we focus on this 100% of the time. We see it every day—potential clients struggle with the decision to hire an outside agency, fearful of the costs associated with that decision. This is simply a lack of understanding regarding recovery rate. When choosing a collection agency, it is critical to pick one that has a high recovery rate. Not only does a high recovery rate mean adding more to your bottom line, but many times it also costs less than a full-time employee.
So, how do I pick a collections agency that represents my business and its goals?
It is not just what you say, but how you say it. The best collectors realize that they represent the face of your company. Not only do federal laws prohibit collectors from abusive and threatening tactics, respectable collectors realize that a positive customer experience results in a better overall company persona, which will lead to a better reputation on behalf of the client.
Interested in learning about contingency-only collections with ART? Give us a call today! 423-586-7613.