A commercial collection agency can help your small business collect debt on past due accounts. The services provided by your arrangement can save you time and the frustration of dealing with deadbeat debtors. When looking for a commercial collection agency to utilize, there are some factors you’ll want to consider.
The five steps to finding a commercial collection agency involve:
- Finding out if the business is licensed. The last thing that you want to do is learn that the agency that you’re working with does not have the authority to collect on accounts for you. You don’t want to be subjected to fees if collection laws are being violated. A good commercial collection agency also has the ability to collect on accounts anywhere in the United States.
- Learning whether it’s insured and bonded. You don’t want to lose your business because the agency you’re working with doesn’t have the resources needed to survive a lawsuit. Insurance and bonding is for your benefit. If an agency has neither, take your business elsewhere.
- Asking how they charge fees. Commercial agencies have different structures for their clients. They may request a downpayment or fee upfront for collecting on past due debts. Others may charge a percentage of the monies collected. This may not be beneficial to people with multiple accounts to collect on. A flat fee is ideal in these situations.
- Knowing if they offer debt portfolio screening. An incredibly helpful tool designed to let you know which accounts will pay and which ones won’t, a debt portfolio screening allows you to determine whether hiring a commercial collection agency is an investment worth making. Knowing what the return on your investment is on these type of transactions can help you determine whether a company’s services are within your business’ budget.
- Acknowledging that you can review your account online. You’ll want to be able to monitor the agency’s progress as collections are being made. Ask if there is a way to check things online. You’ll gain knowledge about your business affairs and be able to gauge how well the commercial collection agency is working for you.
Rather than spend valuable resources trying to collect debt in house, you can count on a team of skilled professionals trained to handle these types of interactions for you. A commercial collection agency exists for good reason. Instead of focusing your energy on past due accounts, you can dream up ways to land new accounts. This will help you grow as a business.
A commercial collection agency is a necessary evil sometimes. When debt collection attempts have failed, it’s best to contact a team of professionals and outsource the task to them. When determining whether a company is for you, go through the list of steps mentioned above. It’s important to trust your accounts to a commercial collection agency that is licensed, insured, and bonded to reduce the amount of risk that falls on your shoulders.
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