Working with a Collection Agency

Sending accounts to a collection agency can actually improve your relationship with debtors. Some debtors don't have a sense of urgency to pay unless a third party is involved. Once those debtors are contacted by an agency, they understand that the creditor is serious about their collection practices and they become reliable customers who pay on time.

When choosing a credit collection agency, a common mistake is to choose the agency offering the lowest rate. A collection agency must consider the cost per account when collecting. A lower rate can limit the collection strategy and time allotted when collecting from your debtors, resulting in a lower net return. It makes sense to pay 25% on a 40% return rather than 15% on a 20% return.

Most agencies pursue both consumer and commercial accounts, but do not train their collectors in the art of business investigation and negotiation. A higher percentage of return will be realized collecting business-to-business debt when dealing with trained and professional commercial collectors. If your customers are businesses, you should use a collection agency that only specializes in collecting business debt.

We have been using Aguirre Aikman + Brown for collection on accounts for several years. They have been very successful in collecting old and extremely difficult accounts. Additionally, they have been very responsive to requests for collection strategies that will allow us to continue business with customers after collection efforts have concluded. We've had many additional sales from customers referred for collection after accounts have been paid. We highly recommend Aguirre,
Aikman + Brown.

Frances Justice
Finance Collections,
PlanIt Solutions

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