Debt Collection Services
All companies have accounts receivable. Accounts Receivable are comprised of the payments due to the business. When your in-house efforts to collect receivables fall short of successful collections or if payments are not received as previously agreed, it is time to consider calling a professional who specializes in debt collection.
While a strong credit policy and collection process may serve your company for the majority of your outstanding invoices, there will come a time when getting paid from a client or customer proves difficult, and you risk being left with bad debt on your books. Even if you can write the bad debt off at tax time, cash flow is the bedrock of company growth, not tax deductions.
There are two kinds of debt for companies, commercial debt and consumer debt. Most businesses experience one or the other depending on the products or services provided and whom they provide them to. However, you may encounter both.
Commercial Debt vs. Consumer Debt
- Commercial debt is a claim that arises when there is a financial obligation between two business entities.
- Consumer debt is a claim that arises when a company has provided goods or services to an individual or an unincorporated association. The claim could also be between two individuals or unincorporated associations. Or against a personal guarantor of a commercial debt.
When faced with the need to actively collect on debts or aged receivables, it is important to work with a professional who understands the laws surrounding collections in each of these categories. At FFGN, debt collection is all that we do. We provide a range of services to help your company achieve successful collection outcomes.
How To Improve Accounts Receivable:
- Have an expert conduct an audit of your credit policy to insure it is optimized for the best possible outcomes and to retain good client relationships.
- Start early. When it comes to collecting debt, the sooner you start the more likely you will have a successful outcome. Statistics reveal that the older a receivable gets, the less likely it is to be recoverable.
- Let it go. At least let the emotional attachments go – owners and managers often experience a range of emotions when facing an aging receivable. These emotions can get in the way of the collection process. Turning the collection over to a professional frees you from the emotional unrest while allowing a professional to proceed with collection efforts that are within the boundaries of the law.
- Collections Outsourcing. Outsourcing allows a company to maintain a professional collections department without the overhead.
- Augment your in-house collections. When your internal collections department is in need of augmenting the existing staff or if you find the need for an experienced collector to help lead the way.
- Contact FFGN for a consultation on improving your collections.
Statistics reveal that when it comes to maximizing recovery of bad debt, time is of the essence.
The longer you wait – the less you collect.
A factor that hampers collections is the emotional attachment to the receivable. By not letting go, business’ sabotage their own collection. Based upon the above chart and our experience, we created the following as a depiction of the emotional process and its effect on collectability.