However scrupulous you are as a business in managing your cash flow, carrying out due diligence on new customers, or following up late payments, it is almost inevitable that you will, at some point, find yourself having to chase outstanding debts. The critical question you need to ask is whether this is something you can manage in house or whether it would be more efficient to outsource your debt collection to an external debt recovery service.
There are a number of reasons why an external agency might be the answer: a good agency knows how to act with discretion, thus continuing to nurture a good customer relationship; and it also knows how to deal effectively, and decisively, with those customers that are, quite frankly, taking advantage of you.
Finding the right debt recovery service
So, how do you go about finding a debt recovery service with the right credentials and one that will underpin, rather than undermine, your good reputation with your customers? First, understand the nature of your debts. Do you need to recover single or bulk debts, regulated or unregulated? A different strategy needs to be applied for each but both require a transparent, effective escalation process if initial attempts to retrieve the debt fails. Second, is your preferred debt collection service regulated by the Financial Conduct Authority (FCA) and thus committed to the policy of Treating Customers Fairly (TCF)? Although this initiative was originally devised for individuals, we have tailored the principles so they apply to our corporate customers too.
Treating Clients Fairly
Principle 6 of the FCA’s TCF initiative is based on the obligation of a firm to pay due regard to the interests of its clients and to treat them fairly. The other principles that also apply include:
Principle 1 - “A firm must conduct its business with integrity”.
Principle 7 - “A firm must pay due regard to the information needs of its clients, and communicate information to them in a way which is clear, fair and not misleading”.
Principle 8 - “A firm must manage conflicts of interest fairly, both between itself and its customers and between a customer and another client”.
Principle 9 - “A firm must take reasonable care to ensure the suitability of its advice and discretionary decisions for any customer who is entitled to rely upon its judgment”.
How do we apply these principles?
The FCA principles are core to our debt recovery service. We pride ourselves on delivering a service where the fair treatment of our clients is central to our company culture. We tailor the most appropriate collection strategies for each client; we know from experience that one approach does not suit all and our advice always takes account of individual circumstances and business requirements. We have a clear communication policy so all clients are kept fully informed from the beginning to the end of the process. Even if clients decide to change tactics during the course of the debt collection, we will take a pragmatic approach and discuss ways in which the process can be amended to accommodate changed circumstances.
Making a difficult task easy
We know that collecting outstanding payments is a difficult task and requires a combination of tact and firmness. There are many reasons for late or non-payment of bills, not least administrative error. But regardless of the reason, we understand that there is more at stake than just the money: the method and manner of the debt collection process will reflect on your brand and reputation. All our staff are fully trained to the highest standards, so you can be assured that your good name is safe in our hands. To find out more about how we can help you be more profitable by minimising your outstanding debts, contact Hazel Wells.