Some entrepreneurs have a lot of concerns connected with the transfer of the debt collection actions to a third party company, inter alia because of the fact that they are afraid of transferring of the responsibility to a third party entity for the service of receivables and thus of losing control over their receivables. These concerns are usually illegitimate if we make good selection of the debt collection company. How to perform the outsourcing? What to avoid?
- Think what exactly your company needs. Debt collection is not a uniform service – its scope may include inter alia services from the telephone contact with the debtors, through field actions up to the court proceedings. Analyse your receivables and their impact on the situation of the company in order to determine properly the final effect that you want to obtain by hiring the debt collector. It will allow for easier sifting of the thousands of offers of the debt collection companies available on the market.
- Adjust the debt collector to your company. The three basic criteria, according to which it is good to assess the debt collection company, is specialisation in the type of the serviced receivables, experience in the given industry and proper resources. Knowledge on the specificity of the industry, in which your business operates, practice in recovery of the low- or high-value receivables as well as the possibility to service a lot of orders at the same time are the aspects that decide on how long you will be waiting for recovery of your money.
- Read the agreement twice. Ask yourself: what is the scope of the service determined in the agreement? Does it include all provisions that are interesting for you? It may happen sometimes that the offer presented earlier differs from what is written in the agreement, so it is better to double-check everything. Let us clarify all incomprehensible fragments and in case of any concerns let us present the document to a trusted employee.
- Price makes a great difference. It is true, nowadays each entrepreneur counts every penny and optimises expenditures. However, we should not let us cut ourselves to ribbons by such thinking. A lot of offers with attractive prices turn out to have very limited scope of the debt collection service, which may not be successful in case of our company. On the other hand, abundant packages may include additional fees and it is not certain that we need all of their elements. A good price is the one, for which we obtain exactly what our company needs – and we come back to point 1 here.
The number of debt collectors on the market is big – for sure, among them there will be the one, whose experience corresponds to the requirements of your company. A pragmatic entrepreneur knows that the best offer is a service adjusted to the specificity of their industry and valued independently.
Published on: 9 November 2016