Debt is a problem for just about anyone – and if you can help it at all, you’d rather avoid being in any form of debt. However, the story does not apply as straightly to a business – the case is that avoiding debts, be they debts of the business or the business having debtors, is more on the side of not being possible.
As such, debt and credit management is of utmost importance in any business. In doing so, sometimes, you might run across the troublesome type of debtors – those that somehow don’t want to pay you back. In such instances, rather than wasting your time going after them, or even letting them go free-handed (you shouldn’t this at all. Seriously), you might want to consider hiring an agency for the job.
• Do your research – A debt recovery agency is a company dedicated towards the collection of debts in place of another business. They basically take care of the troublesome job of calling, mailing, visiting and whatnot your debtors on a regular basis, and make sure that your credit is recovered back. These agencies differ from each other, so make sure to research about them before hiring any one agency.
• Verify the background of the agency – Once you come across a number of agencies appealing to you, the next step is to run some background checks on them. Look for qualifications and licenses to collect debts – this varies from place to place.
• Does the agency use skip tracing? – Some debtors tend to vanish without any contacts – they skip town. As a countermeasure to this, debt collecting agencies can rely on skip tracing, the use of a number of different databases to track down a debtor who has vanished. You might want to look for this kind of agencies if your debtors are of a ‘flighty’ type.
• Does the agency have insurance? – Another important point you have to make sure of is whether the debt collecting agencies possesses the proper insurance against any actions the debtor may take against them in case of bad faith. Since you might also be taken to court, make sure that you have insurance for yourself – that is, proof you shouldn’t be held liable for the actions of the agency.
• Don’t forget to compare – The last and most obvious is step is to compare and contrast the agencies that passed the above four points. You might have found a number of debt retrieval agencies which fulfil your business’s particular requirements, so lastly, make sure to compare the costs incurred when hiring each agency – this way, you’ll end up with the company that suits your needs the best.