If you’ve never used a debt collection agency to recover unpaid accounts for your business then it may be a bit daunting figuring out…
- Where To Start?
- What Questions To Ask?
- Is It Worth Hiring A Collection Agency For Your Unpaid Debts?
- What Information Do I Need To Provide?
This short article will answer all your questions and help you make the best decision for your business.
Where Do I Start?
Before hiring a debt collection agency prematurely there a few steps you should implement first to give the debtor adequate time and warning to pay the overdue account, view The Right Way To Collect A Debt for more information.
The steps laid out in the article link above give you a “Best Practices” timeline of how to proceed with recovering a debt from the “1st friendly reminder” to the last resort of proceeding with legal action.
By following these steps you’ll will help save any recoverable business relationships, give your customers plenty of time and warning to pay, and ensure you do not overstep and privacy or harassment laws.
What Questions To Ask?
With so many debt collection agencies offering collection services these days you need to be very careful who you choose to represent your business. After all if they do not follow the laws and regulations that govern debt collection in Australia it may land your business in legal hot water.
By asking these simple questions before hiring a collection agency you can be sure you are dealing with professionals.
- Are you fully licensed and qualified?
- How long have you been in business?
- Do you offer a No Recovery, No Fee Service?
- Do you provide a dedicated account manager?
- Do you have in-house solicitors specialising in debt recovery?
- What are you collection fees?
- Can you lodge debts online?
- Can you call and speak to a real, live person?
These 7 important questions will help guide you towards a reputable, trustworthy collection agency.
Is It Worth Hiring A Debt Collection Agency?
You may be wondering if it is worth hiring a debt collection agency and can they actually recover a debt from a customer who simply will not pay.
The short answer to both questions is YES!
The convenience and low fees of quality collection agencies makes it so simple and affordable to recover unpaid accounts, whilst also saving you time that it is a worthwhile investment even for small amounts.
(Much better than writing off the debt and losing money…)
It also let’s your customers know that they MUST pay their invoices on time or there will be consequences. You don’t want debtors to think they can get away with paying when and if they feel like it, and the backing of a professional collection agency makes that point very clearly.
What Information Do I Need To Provide?
When you have come to the conclusion that a customer is not going to pay after repeated reminders and it’s time to engage a collection agency there is some important information you will need to provide such as…
- The date the initial invoice was created
- The date the initial invoice was due
- A copy of the original invoice
- The balance owning on the account
- Your business terms and conditions
- Any other relevant information (follow up letters, details of products or services delivered, work orders, signed quotes etc)
Generally this is all you’ll need to start the collection process.
JMA Credit Control’s website even has a secure client login section where return customers can submit new debts via an online form within 2 minutes.
If you’re currently chasing up bad debts, then hiring a qualified collection agency could save you’re a lot of time, money and stress.