Top 5 Myths About Working With a Collection Agency to Assist With Credit and Collections

Published On: July 14th, 2023Categories: Commercial Collections
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Working with a collection agency can be a helpful way for businesses to improve their B2B credit and collections processes and recover unpaid debts. However, there are many myths and misconceptions surrounding collection agencies that may prevent businesses from taking advantage of their services. In this blog, we will explore the top 5 myths.

  1. Myth: Collection agencies are aggressive and use unethical tactics to collect debts. Fact: While there may be some collection agencies that use aggressive or unethical tactics, most reputable agencies follow strict ethical guidelines and are focused on resolving debts in a fair and professional manner. They are bound by state and federal regulations and are required to follow the Fair Debt Collection Practices Act (FDCPA), which prohibits them from using abusive or deceptive practices.
  2. Myth: Collection agencies are only for businesses with large debts. Fact: Collection agencies work with businesses of all sizes and can be helpful for collecting debts of any size. They have the expertise and resources to recover unpaid debts, regardless of the amount owed.
  3. Myth: Collection agencies are too expensive and will eat into profits. Fact: Collection agencies typically work on a contingency basis, which means they only get paid if they recover the debt. Their fees are typically a percentage of the amount recovered, so businesses do not have to pay upfront fees or ongoing costs. Additionally, working with a collection agency can actually improve cash flow and profitability by recovering debts that would otherwise be lost.
  4. Myth: Collection agencies will damage relationships with customers. Fact: Collection agencies understand the importance of maintaining positive relationships with customers, and many have strategies in place to protect those relationships while still recovering unpaid debts. They can work with businesses to develop customized collection strategies that are designed to preserve customer relationships and ensure that customers are treated fairly and respectfully.
  5. Myth: Collection agencies will take over the entire credit and collections process. Fact: Collection agencies can be helpful for businesses that are struggling to recover unpaid debts, but they do not necessarily take over the entire credit and collections process. Instead, they work in partnership with businesses to help offer accounts receivable management services and develop customized strategies for recovering unpaid debts and improving overall credit and collections processes.

In conclusion, a commercial collection agency can be a valuable resource for business owners looking to improve their credit and collection processes and recover unpaid debts. By dispelling these myths and understanding the benefits of working with a reputable commercial collection agency, businesses can make informed decisions about how to manage their financial operations and improve their bottom line.

We would love to continue this conversation with you and to expand upon our products and services here at Bravo Recovery.