How to Overcome the Stress and Frustration of Non-Paying Customers?
Regardless of the nature of business or service that you offer, one of the problems that you are going to deal with is customers who delay in making payments. When a customer tells you that payment will be made in 30 days, you expect that they will do so, to enable you get money to do something else such as paying the supplier, paying business operating bill and expenses such as staff salaries, etc. For many collection agencies locating debtors is not a problem.
The advancement in technology and integration of various systems has made it easy to collect information about those customers who do not pay on time. A collection agency has more capability of lactating the location and whereabouts of non-paying customers that you can do when acting in person. The good news even is that the cost of hiring collection agency in Canada is not as high as many people believe.
You won’t be required to pay until the collection agency recovers all or some portion of the money owed. Generally, the collection agency will take some percentage of the money recovered, as its remuneration. Thus, the collection agency will be as enthusiastic as you are, as it tries to recover the money owed to your business because that’s how it makes its money.
For larger businesses that are likely to encounter problem of delinquent accounts very often, it will be wise if they engage a collection agency on long term basis because hiring one for every individual cases may be costly. If you have ongoing requirement of collection of accounts receivables, some collection agencies in Canada may offer discounts and lower commission on the recovery of overdue accounts.
There is also an advantage of engaging collection agency on long term basis because it will gain understanding of the customers you sell to on credit. It will also have information that may enable it know immediately when an account is overdue and then begin the process of collecting the account receivable before it becomes long overdue.
If you begin the process of collecting accounts receivable soon it becomes overdue, you are likely to recover higher amounts of money than if it remains long overdue. In recovering the dent, the collection agency should operate within the confines of law and other relevant rules and regulations. As much as the law protects businesses so as to ensure that they are paid for services or goods supplied, it also protects the debtors from the arbitrary actions of creditors.
The procedure must be followed in the collection of accounts receivables. It should begin by making phone call to the debtor requesting them to pay. If they don’t them a later may be issued. If they still don’t pay, the next course of action should be decided. Legal action should be the last option because it may take several months or years before the case is concluded, and is costly. The collection agency should thus embrace negotiation and respect in collecting accounts receivables.