5 Reasons to Outsource Your Debt Recovery

Are you debtors giving you excuse after excuse to avoid paying? Are you tired of constantly chasing overdue invoices, adjusting cashflow projections and worrying about money that should already be in your pocket?

Overdue invoices can have a hugely detrimental effect on your cash flow, especially now that we’re in a recession. You might think that hiring a debt collector is an unnecessary waste of money, but here are 5 big reasons you should consider outsourcing your debt recovery function to a specialist.

It’s Cost-Effective

Believe it or not, hiring a debt collection agency isn’t going to cost you a fortune. Our entire job is to help your business be more profitable – which wouldn’t work if we bankrupted you! Depending on the level of support you need, you can hire an expert debt collector for a one-off reasonable fee, right the way up to retained debt collection services. At Debtcol our services are designed to be a cost-effective solution for our clients, as we work on a no-recovery, no-fee basis.

Improved Chances of Recovery

If you try to recover a debt yourself, you have a fair, but not great chance of success. Especially if you don’t have the necessary credit control procedures in place to manage and chase your debtors effectively. And while some people will respond well to an email, most debtors will sit up and take notice if they get an email from a debt collector. And while we can’t guarantee success, we do know that we can significantly improve your chances of actually recovering money owed to you.

Save You Time

Ask yourself, how much time do you actually have to spend chasing debtors? How many hours to dedicate to phone calls, emails, letters and going around in circles with little to no success? Generally speaking, your time could be much better spent doing what you do best, while a professional handles the debt collection for you.

Expert Advice

A lot of the time the difference between successful debt recovery and failed attempts is just knowledge. Understanding of the industry, terms and how best to handle customers are all a part of the debt collectors’ basic toolkit – but if you don’t do this every day then they probably aren’t skills you have in-house. Bringing in a debt collector means you have a team of professionals with expertise, experience and knowledge on hand to provide you with advice and support. Whether that’s helping recover debts ourselves, reviewing your procedures, and even recommending legal action. By outsourcing your debt collection you’re buying yourself an expert, without needing to hire one in-house.

Recover Your Costs

Every debt collection company charges differently – some will charge a set fee, others a retainer, and others will operate on a no-recovery, no-fee basis. Either way, the cost is usually the biggest barrier for business owners looking to hire a debt collection agency. And while yes, it will cost you money, the good news is that you can almost always recover your costs. For commercial debts, unless your terms state otherwise, you are entitled to late payment compensation or your recovery costs from your clients. Late payment compensation is between £40 to £100 per invoice depending on the amount, alternatively you are entitled to your recovery costs. Between that and actually recovering the money itself (as opposed to never seeing it), you’ll still be in a net positive working with a recovery agency.

Peace of Mind

One of the biggest worries modern businesses face is cash flow problems. Outstanding debts on your accounts can become a big problem very quickly, and so it’s no surprise that you want to ensure the money you are owed is in your account as soon as possible. Using a debt collection agency means you don’t have to have those difficult conversations with your clients, you have access to advice and support on how to deal with stubborn collections, and you can sleep safe in the knowledge that your reputation is protected.

If you’d like to know more about the debt collection process, or how Debtcol can help you, just get in touch with the team at Debtcol today to arrange your free, no-obligation consultation.