Debt collection agencies can be a fantastic resource in the fight against late payment and bad debt. But unfortunately, age-old fables about debt collection services exist, scaring many away from using their services.
Fable 1: It’s Expensive
Fact: At AVC Debt Recovery, and via LegalDrop, we offer ‘no win no fee’ as a standard and an analysis and consultation for free. Yes, a truly free lunch. Therefore, we only get paid once we have collected your debt; this will be a percentage of what we successfully recover. The price of our services will be minimal compared to the amount you would lose if you had to write the debt off as uncollectable, and the cash flow implications of it remaining outstanding for longer. Additionally, we have a successful track record in adding fees to get you 100% of the owed debt.
The cost of a call to find out whether you have a collectable debt is a small price.
Fable 2: Customers won’t like it
Fact: We understand that maintaining your customer relationships is extremely important and will take your brand and ethos as seriously as you do. But remember, a ‘won’t-pay’ is not a great customer to have and if someone takes offense to being asked to pay for your hard work, you may not want them as a customer. We always seek to remind people the effect their poor payment is having. Although it is true that some might not like the fact you’ve instructed a debt collection agency, you’ve only done so because they haven’t paid you in the first place.
Fable 3: It’s only for big companies
Fact: Any debt over £600.00 will be collected by AVC Debt Recovery and every company big or small can take advantage of our tenacity. Using AVC is thinking like a big company and recognising that chasing late payment is not your expertise and is a drain on your skillset. When you only have a small team it’s unlikely you’ll have the time or resources to chase late payment without having to neglect key business tasks, such as selling and production.
Fable 4: It’s only for really old debts
Fact: Research shows that the earlier a debt is referred, the more likely it is to be collected. There is always a potential cost trade-off, but time always equals better results in this area. You can chase any invoice up to 6 years, but the reality is most debts over 2 years are tough to collect.
Fable 5: A solicitor is more effective
Fact: Although solicitors must enact litigation in court, they can add costs before you get started and will seek fees regardless of results. At AVC we work on results and are the gold medal standard of collection. If we do not collect, we do not get paid. As such we prioritise recovering the unpaid sums by working with your customer, preserving your valuable relationship, before taking the legal avenue, and have the expertise to do so when the time is right. In addition, unlike solicitors, we manage the legal process at no extra cost.
Fable 6: It will damage my brand
Fact: If you do not receive payment for Goods and Services your brand will be irreparably damaged as you will not be able to meet your outgoings. Brands only exist because people pay and here at AVC we will respect and enhance your brand and your right to be paid as much as you do by using our expertise to help you get paid sooner.
Fable 7: I can DIY or wait…
Fact: The earlier you intervene and get legal support the better and now seeking legal help is easier.
Find our Debt Recovery service, ready to purchase, or get in touch via LegalDrop for a free analysis of the debt and the chances of recovery prior to instruction.
Rather than running after money, you can take time to run your business.
contributed by Colin Ward, CW Contract Law and Legal/ AVC Debt Recovery