It is very common for a business to have unpaid receivables, but allowing these to remain outstanding is not recommended. According to the Small Business Administration, 75 percent of U.S. businesses have customers that either pay invoices late or never pay them. In these situations, the business will attempt to either recover the money itself or hire a collection agency to do so.
Accounts Retrievable Debt Collection Agency
Using internal staff to send follow up invoices and letters can be a productive approach within the first 30 to 90 days that the invoices are due. Employees may even receive positive results from phone calls placed to customers who owe money. The lucky business will be able to collect most of its receivables this way without seeking an alternative debt recovery solution.
If there are a large amount of outstanding invoices or if these are more than 90 days past due, using internal resources becomes less attractive. Every moment employees spend performing a debt collection service is time taken away from their primary work responsibilities. Once a company has reached a point where it is forced to hire several staff members to handle only collection services, it should look for another answer.
Using a debt collection service to obtain money due from customers will allow the business to focus on growth and development. In this arrangement, the business provides the debt recovery agents with a legal right to collect the money on its behalf. The agency then keeps a percentage of the amount collected, which serves as its fee.
Debt collecting agencies are experts when it comes to getting customers to pay past due invoices. They know exactly when to call and what to say without violating any laws. These firms use computer software to find customers that have moved and left no forwarding address. They also use automated dialers in order to place one call after another, which allows them to be much more productive than the employees of the business could.
When a business is faced with many unpaid invoices or those that are over 90 days past due, it should consider moving the collection duties from internal staff to a collection agency. The debt collection recovery agents employed by the receivables service will free the business to focus on growth. Each entity will do what it does best and the result will be an influx of money to the business.
Article Source: Jack Merrifield – www.EzineArticles.com
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