A R Recovery Solutions of Hawaii
Frequently Asked Questions regarding Getting Started
Q: Why should we use a collection agency?
A: It is estimated that 4 to 5 percent of a company's billing will go unpaid. New billings occur every month which means this delinquency issue will only continue to rise. The longer an account goes being unpaid the less likely it is to be paid at all. It is much more efficient for you to focus the majority of your internal collection process towards your more current delinquencies at a time when they are more likely to pay. Failing that, you will find an 80/20 rule becoming apparent. 80 percent of your collection efforts spent on working old accounts that will result in only 20 percent of your collection revenue. Get the older accounts out of your billing department's way so they can focus on collecting the more collectible accounts even faster. One promise - If you do nothing about collecting your delinquent accounts - you'll get ..nothing.
Q: What can a collection agency do that we can't?
A: Your customers have been throwing away the notices you mailed and have not responded to contacts you've made. Once they have been contacted by a collection agency, they will realize that you are serious about obtaining your money and have done something about actually getting it. We bring a formality to the collection process. We have access to specialized skiptracing resources to locate customers who have disappeard. We have the ability to list a collection account with the credit bureaus. Everyone is becoming increasingly aware the value of their "credit score" and how it impacts their daily lives. We have the ability to initiate legal action where warranted without involving upfront costs or time on your behalf.
Q: Isn't it perceived as a "bad business" move to assign accounts to a collection agency? What will my customers think?
A: This is a popular misconception. First off, if a customer is not paying you, they're not really a customer and do you really want them back under these circumstances? Probably not. Actually, with respect to using a collection agency being a negative business move, the reverse is probably more true. Consider the following; There are two video rental companies in close proximity to each other. You have a membership at Blockbuster Video where you know you have outstanding late fess. You also have a membership at Videotyme where you know you have no outstanding late fess. Where are you going to go to rent the movie you want? Your customer does want to pay his outstanding obligation but will avoid doing so as a matter of convenience. We can get you paid and get your customer back to you. They will no longer have to avoid you.
Q: What if I just want to be known as a good guy and not pursue collecting those who owe me?
This question needs to be qualified. Are you actually absorbing these amounts yourself as an individual or are you......... A. not granting the raises you'd like to because the bottom line does not afford you to? B. handicapping your business by not being able to acquire or update your equipment to stay competitive or efficient? C. thanking your paying customers by passing on your losses to them? We return thousands of dollars to our customers monthly. These newly realized funds can used for positive internal advancement.
Q: At what point should an account be assigned for collection?
A: They can be assigned at any time. Our recommendation is to wait until an account is 90 days delinquent. The longer you wait beyond that - the less likely it is to be collected.