How do you choose your collection agency?
May 17, 2016 at 6:35 PM
The first points that come to mind are probably commission rates and recovery rates (of the debt). Your due diligence should include asking about commission, recovery rates, and how quickly legal action is initiated. Have you researched the agency and considered the consumer reviews and negative press?
Commission rates can hide the real truth. Agencies may offer you the lowest commission rate possible for entry-level collections and, as standard procedure, take immediate legal action to maximize the amount of money they can collect and keep out of your pockets.
Do you extend goodwill to your customers and give them every opportunity to pay before you send to collections? Most companies, particularly healthcare, are kind and considerate of their customers. Does that respect for consumers carry over to the collection agency or does the agency use strong-arm tactics to collect! Is that how you want your company represented?
A recent article in the Lincoln Journal Star on May 2, 2016, detailed collection actions of one of Nebraska’s largest agencies. According to the article, this agency takes legal action as soon as possible, including filing suit for debts as small as $60. The legal action taken includes seizing bank accounts and leans. Is this how you want your customers treated?
Now is the time to take a good look at how your collection agency handles collections for you. Consider rates, but also how you want your customers to be treated.