Commercial collections is often a major business challenge. Accounts receivables are usually one of the largest assets of most companies. How can you improve the performance of your revenue? How do you prompt delinquent customers to pay? How do you collect the full balance on accounts that you would otherwise write off? We help companies manage and protect their accounts receivables. We provide companies with a large variety of receivable management tools and services that get you paid.
What you should consider when choosing a commercial collections company?
When considering commercial collection services, it all comes down to our extraordinary commercial collections staff. We are aggressive collectors with advanced degrees and extensive business experience who strive to provide the best commercial collection services for clients large & small, new and established. We handle commercial past due accounts ethically, professionally and in a timely fashion.
Affiliate Law Firm Associated with our Commercial Collections Company
When necessary, our affiliate law firm will pursue commercial collection at no additional cost. If litigation is required, we have a network of attorneys who also work on a contingency basis.
We want to be your Account Receivable Management Partner. Our goal is to become an extension of your overall business strategy and a total A/R solution partner. We are always focused on solid results and our client’s satisfaction. We continually expand our capabilities and growth in all service areas. And of course: NO COLLECTION — NO CHARGE!
How your company can be effective with Commercial Collections?
Define Your Credit Collection Policy
A major cause of overdue receivables is that the business has not defined to its commercial customers and staff when accounts are to be paid. If commercial customers are not educated that accounts are to be paid on time, then chances are they’ll pay. Make sure that your company’s terms of payment are clearly stated in writing to each commercial customer on invoices, statements and contracts.
Invoice and Send Statements Regularly
Develop a systematic invoicing and billing system. Many times your customer hasn’t paid because they haven’t been billed or reminded to pay in a timely manner. This situation usually occurs in smaller or newer businesses where they’re short on staff to invoice and bill.
Use “Address Service Requested”
One of the most difficult collection problems is tracking down a commercial customer who has “skipped”. All businesses should be aware of a special service offered by the Post Office. Any statement or correspondence sent out from a business or professional office should have the words “Address Service Requested” printed or stamped on the envelope, just below your return address in the top left corner. If a statement or invoice is sent to a customer who has moved without informing you of their new address, and the words “Address Service Requested” appear on the envelope, the Post Office will research this information and return the envelope to you on a yellow sticker that gives the new address or other updated information. If the customer has placed a “forwarding order” with the Post Office, the Post Office is required to forward the envelope to the customer and give you a form #3547 with the new address and charge you approx. 50 cents. This will keep your address files up to date.
Contact Overdue Accounts More Frequently
No law says you can contact a commercial customer only once a month. The old adage “The squeaky wheel gets the grease” has a great deal of merit when it comes to collecting delinquent accounts. It’s an excellent idea to contact late payers every 10-14 days. Doing so will enable you to diplomatically remind the commercial customer of your terms of payment.
Use Your Aging Sheet, Not Your Feelings
Many businesses have let an account age beyond the point of ever being collected because he or she “felt” the customer would pay eventually. While there are a few isolated cases of unusual situations, the truth is that if you aren’t being paid, someone else is. So stick to your systematic plan of follow up. You’ll soon know who intends to really pay and who doesn’t. You can then take appropriate action once you know where you stand.
Make Sure Your Staff is Properly Trained
Even “experienced” staff members can sometimes become jaded when dealing with delinquent commercial customers. This usually happens when they have made and broken promises for payment. Make sure your staff is firm, yet courteous and professional when dealing with them. Your collection staff could benefit from customer service training because, in effect, they must “sell” your commercial customers on the idea that you expect to be paid. Make sure that your collection staff is trained to not only bring the account current, but to also maintain good will with them.
Keep Accurate And Timely Payment Records
Once a new commercial customer is accepted on credit, it is vitally important to maintain accurate and timely records on their payment history. If you see any deviation from past payment patterns, and especially if payments become unusually slow, immediate follow-up is warranted. This not only gives you an early alert to impending payment problems, it also gives you the chance for early intervention if there is an outside influence.
Follow the Collection Laws in Your State
In many states, businesses are governed by the same collection laws as are collection agencies. For example, calling customers at an odd hour or disclosing to a third party that they owe you money are just a couple of the numerous collection practices that can cause serious repercussions. If you’re not sure, call your state’s department of finance which governs and monitors collection agencies. Click Here for a summary of the Fair Debt Collection Practices Act.
Use a Third Party Collection Agency Sooner
If you’ve systematically pursued your delinquent commercial accounts for 60 to 90 days from the due date, (and they still haven’t paid) you’re being delivered a message by your client. More than likely, you’ve requested payment four to six times in the form of phone calls, letters and statements. Statistics show that after 90 days, the effect of in-house collection efforts wears off 80%”. That means that the time and financial resources budgeted for commercial collection efforts should be focused within the first 90 days where the bulk of your commercial accounts can and should be collected. From that point on, a third party can motivate a commercial customer to pay in ways you cannot, simply because the demand for payment is coming from someone other than you. Before paying a percentage to a commercial collection agency, or using small claims court or an attorney, check into using a fixed flat fee collection service.
Correct Any Mistakes On Your Part
Sometimes your commercial customers do not pay because they feel you have made a mistake. Unfortunately, many commercial customers believe that “the owner/president doesn’t need the money”. Denying an obvious error only fans the fire of resentment your customer may already feel. If the basis of the non-payment is a dispute over the quality of your product or service, a mutually agreeable settlement between you and the customer should be arrived at promptly. The commercial customer may use a minor dispute to withhold substantial payment. Insist that the undisputed portion get paid immediately, indicating the balance will be negotiated. This will not only help to collect payment, it shows the commercial customer that you are listening to his or her concerns.
Nobody Collects Every Account
Even by setting up and adhering to a specific commercial collection plan, there are a few commercial accounts that will never be collected. By identifying these accounts early, you will save yourself and your company a great deal of time and money. Even though a few may slip by, you’ll find that overall the number of slow pay and nonpaying commercial accounts will greatly diminish, and that’s a victory in itself!
It is incredibly important that your do all of the paperwork necessary to ensure that the payment process flows smoothly. If you do not do all of the paperwork outlined below and if there is a dispute regarding your payment, the advantage will NOT be yours. Make sure you read all subcontracts prepared by others very carefully. If there is something you do not understand, ask questions before you sign.
If you don’t already then you need to:
- Get a signed contract outlining all of the costs and services and/or products you will provide. NEVER WORK ON VERBAL AGREEMENTS.
- Get a signed change order for all additional work over an above the scope of the original contract even if you are not charging for this extra work.
- Get signed delivery or work tickets for each day you worked or each delivery detailing what was done and what was accomplished or what was delivered. Try to be as specific as possible.
- If there is a delay in your work, get a signed document detailing the delay and what caused it. Most delays are caused by the GC or other Subs, but GCs or Developers try and hold this against you anyway. You need ammunition to fire back with if this should become a problem.
- Never sign a GC contract that signs away your right to file a lien.
- Take pictures of your work and/or materials supplied. Digital photography costs nothing and can only help you.
- Take pictures of damage to your work done by others