Should You Hire a Collection Agency Near You?
When you’re looking for a new collection partner, it might be a mistake to look for a collection agency near you. Although buying local is usually a great policy for supporting small businesses or buying produce, the effectiveness of collection services can severely impact your bottom line. That’s why it’s so important to find a collection partner that provides the best services, period, regardless of where your agency is located in the United States.
Ultimately, the question shouldn’t be, “What is the best collection agency near me?” It should be, “What is the best collection agency for me?” Your collection partner should provide you with the best services to suit your business and ensure the highest level of recoveries. To do that, they need a suite of specific products and features that give you an advantage.
Here are a few examples of collection services that your local partner may not have:
Smaller or local agencies often are not licensed to collect nationwide. Even if you’re a small business that only works with consumers in your state, your consumers could move, making it impossible (not to mention potentially illegal) for an agency without national licensure to pursue the past-due account. According to the U.S. Census Bureau, the average person moves every six years, and roughly fourteen percent of the population moves each year.
Whether you’re a small business or large corporation that does business with consumers all over the United States, you need a collection partner licensed and/or bonded to make collection calls and send collection letters across the country.
With a collection partner that is nationally licensed, you can ensure they have every opportunity to recover your revenue, regardless of whether your consumers move out of state.
Not all collection agencies credit report; many rely on calls and letters alone. But credit reporting is a powerful tool that helps you reach consumers that can’t be reached through traditional collection methods. When your overdue consumer receives a notification on their credit report about a past-due balance, it can be a powerful motivator for them to resolve the matter.
Not all debts can credit report, so you will have to work with your collection partner to determine if you’re accounts are eligible. If you are, you’re bound to reach more consumers to resolve your past-due accounts. It’s all the more reason to make credit reporting a must-have service offered by your next collection partner.
Credit monitoring is a unique service that works like a radar, waiting for blips on the consumer’s credit profile that denote significant changes. These changes may include opening a new tradeline, a loan payoff, or a similar credit event that suggests their ability to pay your account.
If a credit event occurs that indicates a positive credit attribute, the account is activated for immediate call attempts and subject to another period of calling. This service is usually reserved for older accounts that might not be receiving as much work effort. It can work wonders to reinvigorate your revenue stream.
However, most collection agencies don’t perform this service, even though it can significantly increase recoveries. Finding a collection partner that offers a credit monitoring product will mean you will recover more of what you are owed.
The Bottom Line
When you’re compiling a list of criteria that describes your ideal collection partner, consider omitting the need for an agency near you. Although it’s nice to have someone just down the road, that convenience should not outweigh the benefit of higher recoveries through a diverse array of collection services.
IC System is located in Minnesota, but our company has successfully collected debts throughout the United States since 1938. Our national licensure, credit reporting, and credit monitoring products remain advantages for thousands of our clients.
About the Author: Brian Eggert
Brian Eggert is a business development specialist and writer for IC System, one of the largest receivables management companies in the United States. With 18 years in the collection industry, Brian's experience includes operations, client service, proposal writing, blogging, content creation, and web development.