How to select best collection agency?
What makes the best collection agency for your business? A great collection partner maximizes the amount of debt collected and returns to you, is transparent in their methods and reporting, and helps maintain a positive relationship with your customers. Keeping these goals in mind, here are 6 tips to choose the right collection partner.
1) Consider total ROI, not only the initial price
There is only one factor to choose which percentage of the agency selected by the agency. Although it may be tempting to compare agencies based only on that percentage, the most important thing is how much money they actually put in your wallet. Many agencies who are able to collect, charge their direct percentage, but the results they actually collect, they vary widely. A low agency encourages work at easy to collect percentages and it can mean that other loans are ignored. In fact, a collection agency with a low fee rate and a low collection percentage will not return high as an agency with higher duty rates and better recovery rates. To make it clear, take a look at this example:
Even if the agency takes a very low fee rate, Agency B is still a better option as the company has more cash back. When shopping for a collection agency, ask for industry analysis to see what kind of results have been established for other companies in your industry in a comparatively manner. That knowledge can help you make a decision based on real returns and is not considered expenditure.
2) Inspect customer service
Have gone to the days of dangerous bill collectors threatening to break the knees caps of extinct debtors? Top modern agencies focus on making customers easy to pay through multiple channels, payment plans and initial intervention. Find a partner who can help you in completing the process of your home with a payment notice in the life cycle of the loan.
Part of the excellent customer service is to ensure that all calls are made from the Home Collection Office. Outsourcing is common in the modern business world, but due to the sensitive nature of the relationship between your business and your customers, it should not be used in the collection industry. Domestic call centers pay dividends in both collection results and customer satisfaction. Avoid debtor complaints by partnering with a collection agency with a local or national presence.
3) Find partners, not partners
To make a better marketing result works with a company like a marketing consultant, a collection agency partner should work with you to develop systems to manage the accounts you receive to increase your bottom line. Collection agents are experts in debt collection, and should work with you to improve in-house collection efforts. For example, many collection agencies will help minimize the risk by checking credit on potential customers, or those sending payment reminders at regular intervals will help pre-archive measures.
4) Look at their track record
With any purchase decision, the best information is from those who have used their services. Ask for referrals from those organizations or individuals who will know best. Some good resources to turn to information include:
â€¢ Accounting firm
â€¢ Business Contacts
â€¢ Chambers of Commerce
â€¢ Better Business Bureau
Collection laws vary from industry to industry, so it is understandable to find an organization with experience in your specific area. They will often be better equipped to deal with the unique challenges of that industry and will use that information to improve the recovery while maintaining the compliance system.
5) Check for required licensing
Under collection agency laws, agencies should be licensed to practice in the state in which they are located. For businesses dealing with in-business clients, the local licensed collection agency is more than satisfactory. If your business is at the national level, however, you will need a collection agency that is licensed to practice in all areas of your customers.
6) Evaluate Reporting
A common loss of many collection agencies is the failure to regularly report collection rates. You should expect at least monthly statements and payments on any account, and access to an online portal where you can see the recovery rates at any time.
The right collection company can do wonders for your cash flow. Completing the right diligence before making a final decision will ensure that you have a partner who will give you the best results.