The Worst Advice We’ve Ever Heard About Third Party Collections
First, a little definition is in order for those who don’t know much about collections. While we all know what collections is, many don’t understand what third party collections means. It simply means that someone, usually a licensed collections agency, who is not affiliated or part of the company that is owed money takes over the effort to collect the money on behalf of the company. Every service based provider, like doctors, lawyers, engineers, and other professionals, will eventually have a need to get involved in the collections process.
The Worst Advice We’ve Ever Heard About Third Party Collections
The worst advice we’ve ever heard about using third party collections is to not do it. By that, we mean that people and companies are encouraged to keep their debt collection practices under their own roof instead of outsourcing it to an experienced and reputable agency that can do the work for you.
Why That Advice Is Well-meaning, but Terrible
When service providers are told not to use third party collections, the people saying it usually mean well. They may think it’s easier than it really is to collect on those funds. They may believe that they’re helping because it is creating another job for someone. They may think that they’re saving money. It’s usually never said out of hate or disdain. It’s the mindset of “why outsource something that you can do for yourself?”
Now, let’s look at the reality of those well-meant thoughts and intentions. Collecting on delinquent accounts isn’t easy and it can cause a lot of stress on the relationship between the service provider and their client. A recent report and survey shows that close to 14% of healthcare facilities must repeatedly contact a patient to get paid.
The next argument is that it creates a job for those who need one particularly if you keep it in-house. Yes, that’s true. However, do you have the funds needed to pay for a person to collect, provide office space and equipment, and provide benefits? It can be very costly to get set up and to continue the training needed (in addition to any license you may need or a bond).
So, that brings us to the third reason why that advice is well-meaning, but terrible. Keeping your collections in-house doesn’t really save you any money. You would have to pay someone to do it and you’d also have to continue sending out bills. Attorney's A.R.M. provides third party collections and we are often 40% cheaper than hiring someone as an employee. It costs you nothing in overhead or benefits, either. We our bonded and each account manager has a minimum of 15 years of experience.
Now for Some Solid Third Party Collections Advice
Shop around for third party collections agencies. Make sure that you hire one that can meet and exceed your needs. Attorney's A.R.M. provides a responsive and professional image on behalf of your company. Also, we offer a free process review. If you have delinquent accounts, you need Attorney's A.R.M.
