If one of your responsibilities to your department or business includes collections, commercial collection consultants can be a big aid in this area. No matter what the size or sector of your business, collections come into play eventually. Rather than calling on a traditional collection agency, consider hiring commercial collection consultants for the more difficult collection jobs.
Commercial collection consultants handle collections but unlike a collection agency, they use the most modern and up to date methods of recovering money. Whether it’s gathering information under the auspices of an audit, hiring a private investigator to help, or keeping an eye on collection deadlines in order to maximize collection efforts, a commercial collection consultant will solve your collection problems.
How do commercial collections consultants use audits to recover money for you? This technique is widely used in cases where outright collection efforts such as calling, sending repeat notices, and threatening the debtor with lawsuits will backfire. This is often the case with clients who are good longstanding patrons falling into a bit of an economic hardship.
Instead of demanding payment, the collection consultant calls the debtor and informs them that you’ve hired them to audit the debtor’s receivables. They claim that this process has been done, and that they’ve noticed there’s a past due amount owed to you on the account. Often just the word “audit” is enough to get a good client to pay.
But what about clients that lean more towards deadbeat than good? This is where using a private investigator is a wise idea that will help you get money back. First, a private investigator is skilled at finding people who you may not be able to contact. When they do skip traces they find new phone numbers and new addresses for people who may have been obscuring their location from your collection department. This puts a serious crimp in the debtor’s plans to avoid you.
Private investigators can also find out if the debtor has any assets, like a house or other businesses. Being armed with this information will help you to judge whether or not it’s worth pursuing collections to the level of hiring an attorney and trying to force a judgment. If there’s nothing to recover, there’s no point in making expenditures in this area.
A private investigator can also tell you whether or not the debtor already has judgments against his or her assets, or if they’ve declared bankruptcy. Any talented commercial collection consultant will recognize that these are important things to know when you decide how far to pursue collections.
Finally, a commercial collection consultant will keep you apprised of the window of opportunity for best collecting on debts. The amount of money you are likely to collect drops sharply the longer the debt is outstanding. At 90 days, you should get about 80% of your money back, but at 180 days, the amount drops to below 70%. After a year it drops sharply to 45%. A good commercial collection consultant will keep this in mind and concentrate their efforts in a timely manner so that you are likely to get the largest return on your open receivables.
Tags: accounting, accounts receivable, business, commercial collection agencies, debt collection, Finance, financial