The internet brought about a plethora of changes for businesses. One of the major shifts has been that ability for consumers to loudly voice their opinions on social media.
When it comes to debt collection, it’s important to remember that the agency you choose to work with is a direct reflection on your company.
Consumers won’t just focus their anger on the debt collection agency they’ll also focus it on your business, making it paramount that you choose a well-respected debt collection agency to assist you.
Let’s review six considerations before you hire a debt collection agency:
#1 Do an internet search on your debt collection agency before hiring.
Quite frankly, not all debt collectors are created equal. You want to make sure yours abides by the local laws, and that agents are polite and courteous when dealing with customers.
Next, make sure the agency you’re working with is licensed and bonded. You should also Google the debt collection agency’s name to see if they have made any serious faux pas related to the Fair Debt Collection Practices Act.
#2 Does your debt collection agency have experience in your industry?
Every industry has a different set of circumstances surrounding their contracts that allow you to collect your fees from a debtor. Ask your agency if they have experience working in your field.
It is also possible that an agency will specialize in a few niches related to your business. For example, they may have several plastic surgery clients, whose patients pay privately, but choose not to work with doctors’ offices who accept medical insurance.
#3 Debt collection agencies specialize in different types of businesses.
Another key consideration is the value of the debt. Some debt collection agencies work with small or home-based businesses, whereas others pursue large company debts.
The difference, of course, is that with small businesses you are often dealing directly with the owners. In large companies, recovery, international debt collectors, the agency must be adept at navigating a billing department.
#4 Compare the fees and rates of different debt collection agencies.
The two basic ways a debt collection agency is paid are on a flat rate scale or by a contingency cost. For your business, would one method be more beneficial than the other for you?
Additionally, many agencies only earn based on the amount of money they collect from debtors. Therefore, it is in their best interest to only take on clients within certain industries where they are experienced.
#5 Get detailed information on the debt collection agency process.
If your debt collection agency suggests that their call-out process is proprietary, steer clear. Instead, they should provide a step-by-step guide to how they handle a case once you provide the paperwork to them.
#6 Ask your agency how they’ll communicate their collections progress.
In reality, the debt collection process only takes three to five weeks of call outs to the debtor. Then, the case is often turned over to the legal system where a lawsuit may be filed.
Ask your debt collection agency how they intend to communicate with you on their progress. A lawsuit may take up to two years to settle. Who will your point of contact be?
Ultimately, just like hiring any vendor to serve your business, you’ll want to make sure you feel 100% comfortable with your debt collection agency before hiring. If you’re interested in hearing more about Direct Recovery’s services, contact us today.