With businesses closures, cut back, and bankruptcies still on the rise, how do you protect your business and get those frozen assets out of your customer’s bank accounts and into yours? Here are some tips from the Commercial Collection Agency Association.
In this economy, it is important to get your delinquent customers placed faster with a collection agency. There has never been a more important time for quick placement of accounts for collection. So how soon should you place?
A good guideline is the 60 day rule. When an account goes 60 days past its due date, the matter should be placed for collection. Here are some criteria to assist you in making the decision to place accounts with an agency for collection.
1. Invoice terms have hit the net due date and the customer is ignoring your requests for payment.
2. The customer makes repeated promises to pay but fails to follow through.
3. The customer has made payment on the debt but the check they issued to your office has been stopped or returned for non-sufficient funds.
4. The customer’s phones are answered by an employee and you can never get in contact with the principal or accounts payable.
It is basic instinct to want to collect the debt yourself. As the vendor, you don’t want to have to alienate a customer and you also don’t want to have to share a percentage of your money with an agency; all of this is natural. But the longer you hold onto these accounts, the more toxic they become. Toxic assets are not assets; they are liabilities and if you don’t see them for what they are they can do serious harm to your business.
To help your business “detox” and turn liabilities into assets, call Corporate Collections International at 888.345.2500.