Choosing a collection agency should be like hiring an employee

When you’re choosing a collection agency to take on your accounts receivable, sometimes the hardest part is finding the right fit. In some ways, it’s kind of like hiring a new employee for your team because they will be working on your behalf. What should this new employee be doing?

Send letters
Many don’t realize that a collection partner can help you recover past-due accounts before they reach collection stage. One way they can help is draft and mail the final notice to the customers. In the hands of a trusted vendor, you’ll know this letter is compliant with federal and state regulations, but at the same time, the message is clear. Beyond that, you’ll have someone on your team who knows just what to say to inspire stragglers to get current. Because there’s no commission for this letter service with IC System, it adds tremendous value to your partnership.

Talk to your customers
Because collecting debts is the core business of a collection agency, adding a collection partner to your team would add a new level of experience and expertise that many small- and medium-sized businesses wouldn’t have the resources to develop in-house.

For example, accounts receivables require expert-level handling simply because of the fact that money is a sensitive subject. On the one hand, it does need to be made clear to your customers that it’s time to pay. At the same time, your customers might feel shame and embarrassment over their debt. That’s why it’s important to screen your prospects for their customer service skills because the best possible outcome is one that both recovers your accounts while preserving customer relationships.

Bottom line, the collection process comes with many legal and ethical considerations, and that’s why it’s important for any reputable agency to train and offer the right resources to their employees so they have the tools to handle every encounter with your customers with professionalism and compassion.

Offer payment plans and settlements
Sometimes, customers just can’t pay off their debt in one installment. An experienced collection partner knows when it’s appropriate to offer a payment plan and when it’s better to offer a settlement. At this point, there’s no need to yank the account from your partner and let your staff handle it. A trusted collection partner can do this on your company’s behalf, following any terms and criteria you’d like to include, and from there, make the offer and collect the final payments.

Offer expertise
Your collection partner can also offer some back-office assistance to help you improve your on-time collection rate. As an extension of your company, a good vendor is generous with their expertise because they want to help your business succeed.

Choose carefully
A bad collection partner can be worse for your bottom line than a bad employee, because they’ll cost you time, unwanted aggravation, and worse, your customers’ trust. When you land a great collection partner, the relationship should feel more like an extension of your team because the competence, trust, and sincere interest in your success is always present.