What is commercial debt recovery and is it right for your company?
If your company has spent a lot of time trying to get businesses you have dealt with to pay debts they owe, you know how frustrating it can be. Some will only pay part of the money they owe your business, while others will not pay anything at all. This is where Commercial Debt Recovery comes in.
What is commercial debt recovery? -- There are services specializing in collecting debts owed by one business to another. These services charge a percentage of the amount they recoup, and have a much higher success rate than companies that try to recover debts owed to them themselves.
How does commercial debt recovery work? -- Once you hire a company to be in charge of your own commercial debt recovery, you will have to give them information about all the debts owed to your company.
This will include amounts, how long the debts have been delinquent, how often you have contacted the debtors asking for money and contact information for each debtor.
The commercial debt recovery service will then contact them asking for payment. This will first be done by letter, followed by another even stricter letter and then several phone calls. If payment of the debt owed is not forthcoming, the service will often institute legal proceedings.
What is their success rate? -- If a company tries to collect their own debts, they will often not have a success rate any higher than five percent.
The success rate with a recovery service, however, will quite often reach at least 18 percent, and will occasionally be more than 20 percent as well.