• Collections is the process of
collecting what you are owed.
• For example, you might
provide your product or
service to a client.
• If the client fails to pay, you
deserve to employ collections
strategies to receive what
you’ve rightfully earned.
Doing Collections Yourself
• Many business owners and
managers try to do the collections
themselves. They’ll send letters
or make phone calls to customers
and request payment.
• Unfortunately, there are some distinct downsides to this.
You have to devote your own limited resources to a
process you’re not an expert in, and the results aren’t
likely to be what you wanted.
Loss of Time
• Doing collections yourself is time
consuming. It requires keeping track
of who still owes you which
amounts, checking back with them,
and pestering people who don’t
want to be contacted.
• With so much accounting, correspondence, and fretting
over the collections process, you’re using valuable time
that would be better spent on other business activities.
Lack of Experience
• Unless your business happens
to be a debt collections agency,
you are not equipped with the
knowledge or the experience to
do an ideal job of debt
• That means you won’t get the results you’re looking for,
and you might even run into problems that you could
have avoided with the proper expertise. The last thing
you want is legal trouble from your collections efforts.
There are laws in place that govern proper ways to collect the
debt you’re owed. You have to comply with:
• HIPAA rules
• federal fair debt collection regulations
• credit reporting rules
• and more
You must respect privacy and avoid overly aggressive collections.
Otherwise, you might be unable to collect the debt you’re owed, and
these actions could even leave you personally liable!
Using Debt Collections
• To avoid the costs of doing debt collections on your own,
you might consider hiring a debt collections agency. These
are organizations that train their employees deliberately to
track down the money you’re owed.
• However, many of them are national agencies that don’t work
closely with your business or carefully learn the ins and outs
of your particular situation.
• For many business owners or managers who need help with
debt collections, a business attorney is the best choice.
• Business attorneys are fully aware of how to navigate the laws
surrounding debt collections, and they are more intimidating
to debtors than a collections agency.
• This is because the possibility of legal action against a debtor
is immediately obvious in a business attorney’s letter.
Attorneys can also obtain and enforce legal judgments on
collections, so they represent a greater threat. This all means
better results for you.
Good Luck with Your
For more information on debt collections and to talk to a business
attorney, contact Northwest Business Law LLC.