The debt collection industry faces many challenges every day. The industry continues to transform due to rapidly changing technology, regulations, and outside factors, and collection agencies must adapt. Many of these regulations are unknown to most businesses and as a result, many debtors dig their heals in, using the offence or breach to avoid making payment.
Debtors are more difficult to locate than ever before in today’s highly mobile society. A great deal of information is available on individual debtors but figuring out the debt collection process can be tough if you are attempting to do it on your own. If you’re looking for a debt collection agency in Melbourne that offers sustainable debt collection strategies, look no further.
Debt collection is a long process. When a debt is not paid after a certain period of time, usually 30 days, the process begins. Overdue payments may be considered indefault. Creditors start sending late or demand notices and possibly making regular calls their debts collected. In cases where debt recovery is delayed, creditors may also hire debt recovery agencies.
Engaging an experienced professional removes the emotion, adds the compliance and because eCollect only gets paid when you do, there is no throwing good money after bad.
Profit is the goal of every business owner. You may experience a situation where your customers don’t pay on time, or worse, don’t pay at all. Even when it occurs only once or twice, you might be tempted to ignore it, but what if it happens repeatedly? The cost of an unpaid debt is not the lost profit but what your business needs to earn to cover the cost of the unpaid account. If the business makes 5% profit overall, and the debt is $100, then $2,000 needs to be put in the bank to cover that unpaid job. You might try calling your customers or sending them a collection letter. In the case that they fail to pay, a debt collection agency is your best option.
It’s common for business owners to wonder when they should bring in professionals when chasing accounts. When should a trade or commercial debt be sent to a collection agency? If it is older than three years, should it be sent to a debt collection agency? Many owners prefer to begin collecting debts when the calendar year starts up anew. Owners may choose to collect debt according to the financial year because people receive their tax returns and can use them to repay the debts. While a debt has a six (6) year statute of limitation, the older a debt is, the more difficult to be can be collect. If getting money from an uncooperative debtor was easy, you would already have the money.
Businesses should deal with their debt problems constantly throughout the year because it is impossible to predict which clients will pay you on time and which clients will not. Debt recovery is a normal part of the arrears process and debtors are rarely surprised when a debt collector calls them about an unpaid account. It’s possible to be late with your debt receivable collection if you wait for a calendar year or financial year.
When it comes to debt collection, it’s best to contact a customer before their account has gone past 90 days in arrears. You should keep in mind that if you gave them a 30-day term at the beginning, they have already had your money for 120 days. As a result, 90 days is plenty of time to follow a robust credit control process, leaving little doubt that debt collection is the next logical step.
Your business’s cash flow is most likely to improvewhen using a collection agency. Unpaid invoices can disrupt the invoice cycle and eventually the business’s cash flow, so addressing them as soon as possible can prevent disruption.You have the best chance of getting back what you owe by contacting eCollect as soon as a payment has been missed. Any money collected in a new tax period, but has already been written off in a previous taxation period, returns funds that are clear of any obligation and effectively become profit.
eCollect has a Commercial Agent License (Vic, NSW, QLD & SA), an Australian Credit Licence (AFCA) and an Australian Financial Complaints Authority (AFCA) and is ISO9001-20014 certified. If you are searching for a reliable debt recovery agency, contact eCollect and get the job done.