Serving small business since 1990
Toll Free: 1.800.201.2274

Collection Letters: In-House vs. Collection Agency

I’m not going to mince words, you’ll find I rarely mince words, it’s an occupational hazard.  Collection agency letters outperform in-house collection letters by a factor of 3 to 1.  That’s a fact, and furthermore, if you have an effective in house collection process in place (you have read and implemented my ‘Step-by-Step Plan for Effective In-House Collections without Losing Customers’ right?) your need for in-house collection letters should be practically non-existent.  If you’re skeptical, I get it.  You might think ‘she’s selling collection letters, why wouldn’t she say they work better?’  Or, if you knew me, you might think, ‘she’s been doing this for 30 years, she’s pretty good at it, she might know what she’s talking about’.  Either way, if you want to collect your money, at all, let alone fast, don’t spend a lot of time in ‘I’ll just give them one more chance’ mode.  If, after you’ve executed all of your in-house efforts and sent at most two in-house collection letters, your customer hasn’t responded, and by responded I mean sent a payment, try pre-paid collection agency letters.  It used to be, if you couldn’t collect, your only option was to turn you unpaid invoices over to a collection agency for a 20% to 30% commission.  That’s no longer the case, now there are several companies including mine, that will send a series of third party letters for you with no commission at all.  This is a resource, use it! It’s inexpensive and it works. 

Leave a Reply