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Creditors
often ask, "When should I place an account with a
accounts receivable recovery specialist?"
Most
creditors tend to look to a specific receivable age when
placing an account. Generally, if an account is 90 days
or older, a creditor should initiate placement with a
collection agency, especially if an unsuitable response has
been received from the debtor. At
that point, most creditors have sent out several statements
and letters, and made collection calls. Most have tried
to move the debtor toward satisfying their account
responsibility. The debtor's lack of response, or an
unsuitable response, to collection calls and letters --
indicates a lack of concern or a cash flow
problem. In
either case, an accounts receivable problem exists, and the
account should be placed immediately. Collection
Fees Are One Factor In Selecting An Agency General
Guidelines For Placing Accounts
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Two
or more broken promises of payment. This might
include promises-to-pay, but no checks or other payments
have been received, and the debtor will not send immediate
payment by overnight delivery.
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The
debtor repeatedly requests documentation even though they
have been supplied the documentation. This is a
common practice used to delay account payment.
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The
debtor's phone/fax is disconnected. Check your
records for alternate numbers, check directory assistance,
and if no new number can be obtained place the account
immediately.
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The
debtor states that they will not follow your terms of
sale. Perhaps they say that they pay bills in sixty
or ninety days. If you did not have an agreement
with the debtor for extended terms, this is obviously a
delaying tactic. Be sure to explain to your debtor
the terms of sale and request immediate payment. If
they refuse or fail to pay as promised, place the account
immediately.
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Your
debtor indicates an inability to pay, either by failing to
establish a realistic payment schedule or refuses to
provide a specific date for payment. This indicates
a cash flow problem and steps should immediately be
undertaken.
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The
debtor indicates that they will "take care of the
account," but refuses to make a solid, realistic commitment
for the payment or to establish a payment schedule.
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Your
debtor suddenly indicates a dispute regarding the
product/merchandise shipped, or your terms of sale.
Such a dispute was not raised previously, and seems to be
conveniently timed. If the investigation proves the
dispute is without merit and the debtor will not take
steps to make payment or resolve the matter, the account
should be placed for collection.
Start seeing the dollars you
have earned today -- contact Cash Flow Management, Inc. for
professional, prompt, low-cost results.
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