You might think we have a vested interest in telling you to outsource debt collection to us, but that’s not actually what this article is going to do – because whether outsourcing debt collection is right for you depends on your unique circumstances, and there are several options to choose from even if you do.
For a start, of course some companies have in-house credit controllers, whose entire role is to issue invoices promptly, make sure they are received and paid on time, and chase any outstanding debts. However, not everybody has that in-house capacity – so when should you outsource debt collection?
If it’s a one-off debt that has gone overdue, you might want to just outsource the debt recovery itself, authorising a debt collection agent (or DCA) to chase the debtor on your behalf. You’ll still have a say in what steps are taken – outsourcing debt collection doesn’t bind you into taking formal legal action and going to court, or anything like that, although your DCA might recommend that as your best course of action.
If you’re regularly having problems with clients’ payment promptness, then you might want to consider outsourcing credit control completely. This overcomes the problem of lacking that expertise in-house, but it also allows your outsourced credit control provider to act as a complete invoicing department for you.
You can get a dedicated telephone number for customers to call, which will patch straight through to your outsourced credit control team – who will answer using your company name, for a seamless service. They will take responsibility for tracking your invoices and whether they’ve been paid or not, and chase for debt recovery on unpaid sums.
Ultimately, total outsourcing of credit control relieves you of the largest stress and admin burden, while giving your credit controllers the best visibility of your accounts and what’s owed to you.
So when it comes down to it, if you can’t handle credit control and debt collection in-house, outsourcing one or both of those functions to a specialist is probably your best bet.