Management Diary The Quintessential Survival Guide in the Corporate Quagmire!

Selecting A Collection Agency


If you run a business, you are sure to have some customers who require a lot of follow-up before they pay you. Often you spend too much time and energy to collect money that is rightfully due to you. Giving this task to a collection agency will help you:

Concentrate on your core business rather than on non-core tasks like debt recovery. Increase your debt collection and reduce bad debt.

Selecting A Collection Agency

You must consider the following factors while selecting a collection agency:

1. Experience

How many years of experience does the collection agency have? Does it have experience in the debt collection services you require, such as commercial, medical or check collection? Can it collect debt for your kind of account balance? Can it give references?

2. Professional Collectors

Are professional collectors in the collection agency well trained to deal with your customers? Remember, they are going to represent you and tempers may run high in debt collection. One bad conversation can spoil your relations with the customer.

3. Expertise In Local Debt Collection & Debt Collection Laws

Debt collection agencies use many techniques. These include skip tracing and written communication.

Does your debt collection agency have enough local sources for skip tracing or finding people who are avoiding you?

And does the agency have good knowledge of local debt collection laws so that they don't go beyond legal boundaries?

Breaking laws for collecting debts can prove more harmful to your business than bad debt. If your customers are spread across multiple states, it is better to select from collection agencies having offices in those states.

4. Options

Does the collection agency offer you multiple ways of debt collection and will it follow only ways approved by you?

5. Value-Added Services

Does the agency offer value-added services such as advice on contracts and legal documents and eliminating customers having bad payment histories?

Collection Agency Services offers you a wealth of information on how to select the best collection agency for your business.

MORE RESOURCES:

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In this Tuesday, Jan. 24, 2012 photo, Jon Creek pets his dogs Harley, left, and Memphis while studying for a graduate school admissions test at his home in Mason, Ohio. Creek, who lives in suburban Cincinnati, was a construction company office manager until he and almost everyone else at the firm were laid off in December 2007. He'd known the business was in trouble and says he actually turned down another better-paying job earlier, out of loyalty. It took 18 months to land part-time work as an insurance agent's assistant at $240 a week - a dollar less than his unemployment checks. (AP Photo/Al Behrman)AP - J.R. Childress is up before the sun, bustling about in the French colonial brick house he built. He helps pack his wife's lunch, downs some eggs or cereal for breakfast, pores over online and newspaper job listings and hopes — even prays — this will be the day when his fortunes turn around.



Greece warns bailout rebels of disaster (Reuters)
Reuters - Greek Prime Minister Lucas Papademos told lawmakers to back a deeply unpopular EU/IMF rescue in a vote on Sunday or condemn the country to a "vortex" of recession.
Greece's grim choice: deep budget cuts or default (AP)

Protesters carry a banner which reads in Greek '' uprising '' during a protest in the northern port city of Thessaloniki, Greece, Saturday, Feb. 11, 2012. The leaders of the two parties backing Greece's coalition government called on their deputies Saturday to back legislation that calls for harsh new austerity measures - essential if Greece is to get a new bailout deal worth euro 130 billion ($171.6 billion) and stave off bankruptcy. (AP Photo/Nikolas Giakoumidis)AP - Why would Greece accept more pain when unemployment is at 21 percent, the economy is enduring its fifth year of recession and rioters are hurling gasoline bombs in the streets of Athens?



A look at economic developments around the globe (AP)
AP - A look at economic developments and activity in major stock markets around the world Friday:
NY's AG isn't backing down from Wall Street probe (AP)

FILE- In this March 18, 2011 file photo, New York Attorney General Eric Schneiderman answers a a question during a news conference in his New York City office. Although shrugging off the “sheriff of Wall Street” title, Schneiderman stood firm against major banks when he rejected a settlement over the mortgage collapse a year ago, because it shielded them from future investigations (AP Photo)AP - New York Attorney General Eric Schneiderman, a lead investigator into the mortgage collapse that wobbled the U.S. economy, hasn't taken the title "Sheriff of Wall Street" that one of his predecessors rode all the way to the governor's mansion.



Summary Box: Commodities fall on Greece debt woes (AP)
AP - GREEK WOES: Commodity prices fell broadly as a plan to fix Greece's crippling debt crisis remained far from settled, renewing concerns about global economic growth.
Most commodity prices fall on Greece debt woes (AP)
AP - Commodity prices fell broadly Friday after a plan to fix Greece's crippling debt crisis suffered a setback, renewing concerns about global economic growth.
Bernanke urges action to heal housing markets (Reuters)
Reuters - Federal Reserve Chairman Ben Bernanke on Friday issued a call to action to restore U.S. housing markets, saying depressed house prices and sales are a serious drag on the economic recovery.
Obama call for manufacturing revival a tough goal (AP)
AP - President Barack Obama is making a strong election-year push for an economic revival "built on American manufacturing." But he faces an uphill slog, with little consensus even within his own party on how to do it.
Gov't on pace for $1T deficit despite January dip (AP)
AP - The federal deficit was lower through the first four months of the budget year than the same period last year. Still, the deficit is expected to top $1 trillion for the fourth year in a row, putting more pressure on Congress and President Barack Obama in an election year.
Bernanke: Weak housing has hurt consumer spending (AP)

U.S. Federal Reserve Chairman Ben Bernanke speaks about housing markets in transition at the International Builders' Show organized by the National Association of Homebuilders in Orlando, Florida February 10, 2012. REUTERS/David Manning (UNITED STATES - Tags: BUSINESS POLITICS REAL ESTATE)AP - Ben Bernanke says declines in home prices have forced many Americans to cut back sharply on spending and warns that the trend could continue to weigh on the economy for years.



January budget gap shrinks (Reuters)
Reuters - The monthly budget deficit narrowed to $27.4 billion in January from $49.8 billion in the same month a year earlier, partly because some benefit payments normally made in January were shifted to December, the Treasury Department said on Friday.
Anxiety over incomes hits consumer morale (Reuters)
Reuters - Americans felt worse about their personal finances in early February, but rising confidence in the labor market's prospects should help to support spending and the broader economy.
Romney appeals to U.S. business with harsh China talk (Reuters)
Reuters - Mitt Romney slammed China's "autocratic model" of capitalism in a speech to technology executives on Friday, keeping up attacks on the economic powerhouse days before a visit from a Chinese official expected to be the country's next leader.
Housing a "significant headwind" to recovery: Fed's Pianalto (Reuters)
Reuters - The housing market is holding back the broader economic recovery now that foreclosures have become "a national crisis," a top Federal Reserve official said on Friday.
Exclusive: Future of bank benchmark rate under review (Reuters)
Reuters - A global probe into whether banks colluded to set the interest rates at which they borrow money from each other has thrown into question the future of the benchmark they use to price financial products worth an estimated $360 trillion.
Bernanke urges action to heal U.S. housing markets (Reuters)

U.S. Federal Reserve Chairman Ben Bernanke speaks about housing markets in transition at the International Builders' Show organized by the National Association of Homebuilders in Orlando, Florida February 10, 2012. REUTERS/David Manning (UNITED STATES - Tags: BUSINESS POLITICS REAL ESTATE)Reuters - Federal Reserve Chairman Ben Bernanke on Friday issued a call to action to restore U.S. housing markets, saying depressed house prices and sales are a serious drag on the economic recovery.



Spain cuts firing costs in new labor reform (Reuters)
Reuters - Spain cut severance pay for workers on Friday and watered down collective bargaining rights, giving more power to employers as it attempts to kick start its moribund jobs market and slash Europe's highest unemployment rate.
Portugal watches Greek debt drama with foreboding (Reuters)
Reuters - Portugal's economy will shrink as much as Greece's this year, according to IMF projections. The two will have identical current account deficits and the red ink in Portugal's budget will be almost as deep as in Greece's.
Trade deficit widens to $48.8 billion in December (AP)

In this photo of Feb. 4, 2012, a cargo ship, owned by German shipping company Hapag-Lloyd, crosses New York Harbor. The U.S. trade deficit widened in December, reflecting a jump in imports of autos and industrial machinery. For the year, the deficit climbed to the highest level since 2008 as both exports and imports rose to all-time highs. (AP Photo/Mark Lennihan)AP - Monthly U.S. exports to Europe grew in December, a hopeful sign after a steep decline the previous month. But, some economists remain concerned that the region's debt crisis will still weigh on the U.S. economy this year.


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