Small Businesses and Collection Agency Contracts
Payment integrity is a major concern for any business owner, particularly when considering the impact of late payments. If you are running any type of business, you will have clients that are late in paying their bills or, in the worst case, attempt never to pay at all. In a perfect world, customer payments would come in on or before the due date, and no one would delay payments to you. But we all know that’s not how things work. In the unfortunate case that you find your business regularly requests errant customers to ensure they are current on their payments; you may want to consider hiring a collection agency. This article beneath will expand upon the reasons that you might need to do such.
Delinquent Payment Collection
When a customer does not pay her bill on time, you should examine internal procedures to ensure that all staff members follow them. After a period of time, often thirty days have passed without receiving payment from a customer, we recommend sending a statement. If the customer is a regular monthly biller, ensure the past due amount is indicated clearly on that next invoice. If you don’t hear from them promptly, follow up with a phone call.
Unfortunately, this is not always effective, and your efforts may go unheeded. If the phone call should not suffice in collecting a delinquent payment, some more active collection attempts should begin.
Contact A Collection Agency to Collect
Clients who do not pay on time can become a burden on a business. It is ideal to be able to collect accounts yourself, but when you have tried everything else, sometimes it is necessary to hire a collection agency. In addition, a collection agency can be a helpful resource if you’re having issues with various collection problems – For instance, with multiple debts or if a debt is too large for small claims court.
In the case of a total collapse, or if a client is incapable of paying – collection agencies will negotiate with clients to obtain partial payment, even if the amount is less than what is owed. Some amount recuperated is better than none.
Finding And Choosing The Right Agency Can Be A Challenge.
Knowing who to hire can be a hassle to determine. But, when your payments are part of the calculations, ensuring that you are finding the best collection agency for you is essential. A few helpful steps to vet your collection agencies begin here – Research an agency’s reputation by reading online reviews, checking with the Better Business Bureau, and viewing its rating by Consumer Affairs.
You can also contact your state attorney general and the Consumer Financial Protection Bureau (CFPB) to see if any lawsuits have been filed against the business you’re researching. Finally, contact our experts at Thompson Law for a consultation for further helpful tips and tricks. We have experience in assisting small businesses just like yours.