External debt collection benefits businesses for numerous reasons. Collecting debt is an unfortunate (but often necessary) part of doing business, and not dealing with it can prove very costly.
So, why is an external debt collection agency better for businesses? Read on to find out.
External Debt Collection for Businesses
Regardless of your business’s niche, it’s unlikely that you have the time and resources to handle debt collection. In fact, even big businesses like utility companies use external debt collection agencies.
Here are some of the main benefits for businesses:
1. It saves time (and money)
Perhaps the most important reason is that it saves you time as a business. Providing you follow our credit control tips, you’ll have done everything you need to – including sending follow-up letters.
But, there comes a time when chasing debt eats up too many resources, and this is when it’s better to pass it to an external debt collection agency. We’ve had more than enough customers tell us they’ve spent thousands taking debtors to court, whereas a debt collection agency usually works on a no win, no fee commission. In the long run, this saves you money.
2. It makes you appear more credible
Playing along with a debtor’s excuses allows them to take advantage of your seeming generosity. As we discuss in another post, accepting their reasons for delayed payments means they can carry on making excuses.
However, instructing an external debt collection agency shows you’re serious about getting your money back. Many businesses and customers are compelled into action when they see a letter from a debt collection agency. This is exactly what you need to get your money (and credibility) back.
3. People engage more with external agencies
In our experience, debtors tend to engage more with external agencies. Why is this? Well, there are several reasons. As mentioned above, it’s a more credible method of collecting debt because agencies are serious about what they do.
Similarly, a debtor who’s already spent months making excuses isn’t going to take you seriously. But, when a debt collection agency gets instructed, the debtor has a new company to deal with. And, importantly, debt collection agencies don’t accept excuses.
4. There’s only so much you can do
It should be clear by now that there’s only so much a business can do when collecting debt. Aside from taking the debtor to court, your powers are fairly limited. And, as we’ve established, that’s an expensive way of dealing with it.
An external debt collection agency specialises in collecting debt. As part of this, many agencies work with specialist law firms and can help negotiate settlements. While success rates vary, it’s usually around 85% on a No Win – No Fee basis.
Conclusion
Using external debt collection is an obvious choice for a business. After all, you’d likely contract specialist companies for other aspects of your business processes, so why not apply the logic to debt collection, too?
If you need business debt collection, Taurus Collections is here for you. We offer no win, no fee collections, so please contact us for more information.
Do you need help with debt collection? Our services might interest you!
Contact us now, and enjoy the benefits of a good debt collection agency.