Within the first 60 days of an account being past due, I recommend my clients do all they can internally with a small, efficient, effective debt collection team. Don`t make the mistake of repeating the same process over and over again expecting different results.
After performing your internal procedures during the first 60 days, any receivable still uncollected should be turned over to a 3rd party agency utilizing a fixed fee not a contingent fee. When utilizing a Fixed Fee, companies may include the fixed fee onto the receivable owed to their company resulting in free collections. The result is a reduction in your internal collection costs and bad debt. Along with an increase in Accounts Receivables Turnover, Days Sales Outstanding and Cash Flow!