Do you need to collect outstanding revenue?
And is your current “system” working for you, i.e. getting late payments mailed in to the office or folks calling up with their credit card number for you?
If not, there’s a reason why… and it comes down to having a system or process in place that you can use systematically.
One that works more times than not.
Let me explain…
The value of having a process
For most small business their collections “process” might be to wait for a late payment to arrive. Maybe as much as 30 days or so.
Then what?
A second notice invoice. More waiting. And finally a third notice out the door.
Now, there are two major flaws with this type of system or process. First, it takes time. And time, as you well know, IS money. And secondly, related to the first point, the longer you go without collecting even a portion of what’s owed to you the harder it is to collect.
Makes sense, right?
Similarly, if you handle this in-house rather than getting outside help the question is, how successful are you at collecting what’s owed to you?
Look, if it ain’t broke don’t fix it.
If sending out “reminder” invoices is working with the occasional collection call handled by your office manage or other staff person works more often than not then by all means keep doing what you’re doing. But if not, and that’s a big “but” (no pun intended), then maybe it’s time to set up a more successful process.
So might this work?
First, decide on how long you are willing to wait for a late payment before a customer, client or patient ends up in your collections process.
Next, outline the exact steps you will take when someone enters your process. Maybe that means you will send out one reminder invoice or bill, or give that person a call by a certain date. And outline this process and communicate it to your staff. Get everybody on board.
Finally, factor in that you may need to get an outside agency involved in your process should the first couple of steps you take not work out.
When choosing a collection agency ask about:
- their success rate
- years in business
- licensing
- if they have worked with other businesses in your niche/industry
And then share with them your process and ask for any suggestions regarding what you are currently doing, and how they would seamlessly integrate into that process. You can also ask them what steps they will take when collecting on your behalf, i.e. how will they contact your customers, clients or patients? What form of communication will they use? What will they say, and how will they say it?
The ultimate reason for having, and then refining, any process is to get more predictable results for your business. At the end of the day collecting a better percentage of outstanding revenue, in less time, will help your bottom line.
In my book that’s a win-win.
Find a debt collection agency today
To find a collection agency that specializes in helping businesses like yours, simply request a free services quote from qualified and reputable companies.
Click the link and compare free collection agency quotes today.
This way you can save time, money and aggravation by hiring a professional who can help you collect some (or all?) of your outstanding accounts receivable.
After all, when you get down to it you really have two choices:
- you can keep doing what you’re doing (and hope for a different result), or
- you can find a commercial collections agency that can help you recover what’s rightfully yours.
Either way it’s your money… you decide.