A difficult part about being a small or medium-sized business owner is when you see a number of your clients not paying their bills. At this stage in your business - you have little time on your hands to go chasing after your customers for every unpaid invoice. In fact, as these debts get old, it becomes even more difficult to collect them from your client!
This is why hiring a professional debt collection service may be in your best interest today as they can recover your deserving dues quickly and efficiently, without you having to compromise your valuable time and energy. Here are five signs that tell you it may be time to contact a debt collection agency.
1. Overdue Receivables Are Impacting Your Cash Flow
One of the most obvious signs that you may need the help of a debt collection agency, is when the overdue bills you need to collect keep mounting. In fact, they now impact the cash flow of your business, where you are incurring regular losses. This is why it’s advisable to not wait too long, otherwise, you may reach a point where you will be unable to pay your own bills!
2. Collecting Bills Take Up Your Precious Business Time
For any business, time is of the utmost importance. The minute collecting debts from your customers interferes with your time that is used to do core business tasks, it may be time to hire a collection agency. These services will collect these debts professionally for you, saving up your immense time and energy in the process!
3. You Don’t Have Dedicated Staff to Handle Collections
One bad debt collection strategy that many businesses may invariably opt for is asking their accounting bookkeepers or even sales professionals to collect overdue bills from their customers. This burdens their workload, harms morale, and there is a chance you may lose good employees! As for sales reps, their role is to nurture good relationships with the company customers. Sending them back to collect your debts may hamper client relations and thus your business.
Instead, it's always better to employ a good debt collector to recover your bills. This is because they know the nuances of debt recovery laws, deal with customers professionally, and yet maintain good relations with them. Your debtors too, are bound to take them more seriously and will quickly pay up for fear of getting sued instead.
4. Accounts Show Unpaid Invoices That Are Older Than 60 Days
If you see a frequent number of accounts where payments are not being made even after 30 to 60 days, it’s the right time to contact a collection agency. After 60 days, these accounts are considered ‘delinquent’. This is when you tie up with a debt collection service that will work on recovering these funds from your debtors on your behalf. If you wait longer than this, you may incur more difficulty in collecting your debts.
5. One Of Your Debtors May Be Going Bankrupt
Look for telltale signs such as repetitive bouncing checks or no response at all to your frequent attempts at communication by the client. Chances are that your debtor's business may be running out of money, and your instincts tell you that the debt may get written off if you don't act on time. So, don't wait too long and hire a collection agency to do your work.
While these signs suggest that you are in need of debt collection, you must also ensure to do some research and hire the best one out there. These agencies should also possess licensing certificates, error insurance policies, and have significant knowledge of legal ways to recover debts. At IDC Technologies too, we specialize in getting you in touch with such top-grade debt collection services who will collect your dues quickly and efficiently, all the while maintaining good relations with your clients.