April 6, 2011

Debt Collection and the Power of Urgency

When debt collection is performed with a sense of urgency, then the chances of actually recovering the bad account increase exponentially.  There are many reasons for this, but let us analyze a few of these reasons.

  1. Age of the File - The age of a bad account actually plays a huge part in whether it is recoverable.  Why is this you ask?  As we all have witnessed, businesses can go bankrupt seemingly overnight.  They can also change their number or move locations, making it harder to track them down.  Management changes and they may not have any idea about the debt.  Some businesses keep bad books too, so the older a file is the harder it is to track down the invoices to prove that they actually owe the money.  Needless to say, the sooner you can act on a file, the better off you are.
  2. Motivating the Debtor – If you call the debtor and have no sense of urgency, then you are unlikely to inspire them to repay the debt.  If you call up and light a fire under the debtor and instill a strong sense of urgency, then you can turn the tide with the debtor.  This has been proven time and again in our business.  When we call and set firm deadlines with the debtor, we are able to recoup your monies at a substantially higher rate than without deadlines and urgency.

These are 2 of the main reasons to act with urgency and a sense of expediency when implementing your debt collection tactics.  Otherwise, you will seldom collect and be sitting there with a pile of old debts, that could have been recovered.

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