How do you know that you need to hire a collection agency to help with your problem?
Imagine, opening up a new business and stressful issues come forward to ruin your path? You’ve spent a lot of time and money to build your business, and you can’t wait to see it become successful.
And when everything is doing well – until one of your clients doesn’t pay their invoice.
So, what are you going to do with it?
Generally speaking, a newly opened business doesn’t make a profit until they become three years older, but most of them don’t make it that far because debts ruin a business.
According to a statistic conducted by Forbes, more than 80% of start-up businesses fail within their first few years. This is the most common sign that you need professional help from a Debt Collection Agency, especially if you’re losing a profit and money because of non-paying customers. Also, there are other signs that you need to watch out for before it turns into a more complicated issue.
It could be the right time to hire a collection agency if:
- You have unpaid invoices older than 90 days
Remember, in business, timing is everything to be successful.
It is vital to review and identify slow-paying clients immediately. A client’s ability to pay invoices as quickly as they can lessen the longer it stays in the collection period. Study shows that after 90 days, a business can lose 10% per month on unpaid invoices.
Also, a collection procedure should be followed and be done in a regular schedule with timely follow-ups.
- Your customer paid you bad checks
This is the common red flags that a customer is not reliable and trustworthy when it comes to paying bills promptly. Debt Collection Agency can identify and analyze the information regarding the person’s credit history and help businesses to prevent possible slow payers, which can save you a bunch of profit in the long run.
- You’re not aware of collection laws
There are several laws about collections, and it varies depending on the state. Well-Informed creditors and debt collection agencies won’t hesitate to sue a person if they know that the individual has broken the law.
Also, debt collection agencies are well-informed regarding these laws for each state as well as federal laws. So, hiring a debt collection agency will help your business to solve any legal risk involvement you’re currently experiencing.
- More customers have failed to pay on time
If the number of unpaid customers is increasing in your list, this is the time that you should hire a collection agency. They will surely help you to meets your needs, especially when it comes to debt collection.
Remember, if there’s a non-payer exist in your list, expect that more customers will do the same.
- You don’t have employees to handle unpaid collections
Hiring a debt collector from a collection agency will help your employees to focus more on their job instead of managing the company’s debt collection efforts.
This tip is useful, especially for newly opened businesses with limited resources or budget for debt collection efforts. So, the next time a customer fails to pay any unpaid invoices, take action, or else your business will suffer later.