Accounts Receivable Depreciation - Get The Worm!
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The more delinquent your accounts become, the less collectable they are. At
ninety days delinquent, your accounts start depreciating faster. By six months
delinquent, they have depreciated so much, that only thirty (30%) percent of
your money will be collected. Data from the US Department Of Commerce. This
rapid loss in value is call Accounts Receivable Depreciation.
Accounts Receivable Payment Processors
Accounts Receivable Depreciation is a silent destroyer of the profit margins of most businesses. The key any type of successful collections, be it in-house or third party, is tightening and shortening the process, then forwarding the account out to the collection agency within 90 days. If you choose to wait longer you are depreciating most of your chance of ever getting your money. A common mistake most businesses make is to wait over 6 months to use a collection agency. They do this because they don't want to pay a high percentage or damage their hard earned reputation. Start early, recover more is what debt collections is all about.
Start Early, Recover More
Forceful commercial collection demands are sometime necessary. In these situations, using verbal demands from highly skilled commercial collection agencies, can motivate difficult business debtors to pay you what you are owed. The best time to hire a collection is yesterday! So if you adopt the start early, recover more mentality - you will always recover more of your accounts receivable.
There are reputable collection agencies that specialize in early intervention to assure that you are maximizing your collections and not leaving money on the table. Another benefit of using a collection agency earlier is that you save a lot of your time and resources on chasing after people or businesses who have no intention of paying you. Don't let Accounts Receivable Depreciation eat up the money you have earned!
