What is Commercial Collections?
Commercial collections, also known as business-to-business or B2B debt collection, is the process of collecting past due debts from businesses. Commercial debt collection is restricted to debts owed by companies, rather than debts owed by individuals.
What Types of Businesses Can Benefit From Commercial Collections Assistance?
Any business that has clients with past due accounts or that struggles to collect large balances from customers could potentially benefit from working with a commercial collection agency. Just like businesses outsource services like HVAC repair or logo design, outsourcing Phoenix commercial collections to experienced professionals can help improve the cash flow of a business and free up employees’ time to focus on other tasks.
Some Phoenix commercial collections firms specialize in collections for specific industries, such as trucking, transportation, and freight; wholesale seafood and produce; restaurant supply and equipment; heavy equipment rental; and other specialized industries.
Commercial Collections in Phoenix, Arizona
People often confuse consumer and commercial debt collection practices. Whereas consumer debt collection refers to collection from individuals, commercial debt collection is all about business to business collections and transactions. While the general purpose is the same, to collect debts owed, the process and practice is a bit different. When working with a Phoenix commercial collections firm, it’s important that you understand the value and differences of working with professionals in the commercial side of the collection business.
In addition to following all state and local regulations, any Phoenix commercial collections agency should be able to demonstrate expertise and experience in the type of collections needed. The collections firm should be able to outline a clear process for collecting past due accounts that is in line with the business’ goals, as well as all ethical standards and practices.
Choosing a commercial collections company for any of your needs in Phoenix means considering these factors carefully. Research your potential debt collector and choose someone with a history of successful collections in your industry. These companies will essentially represent you in your attempts to collect on any outstanding debts, so be sure that they’re both reputable and effective! Another major consideration is the cost associated with hiring a collections agency.
Cost of Phoenix Commercial Collections
When considering outsourcing commercial collections, many businesses worry about the cost of the service and how it will impact their business. Most commercial collections firms work on a contingency basis. That means the collections firm doesn’t get paid until they collect money owed on the debts they were hired to collect. Generally, the firm retains a percentage of the amount collected and forwards the rest to the business. This provides a great incentive for the firm to collect the balance owed and means businesses aren’t out even more money for services while they wait to get paid.
The amount of the contingency fee varies across different firms and is based on a variety of factors, including the amount of debt to be collected, the type of debt, the age of the account, and the type of work required to collect the balance.
When to Consider Hiring a Phoenix Commercial Collections Firm
How does a business know when it’s time to hire a commercial collections firm to help collect unpaid balances? Research has shown that internal collection efforts are the most effective within 60 days. If a business is still struggling to collect balances after 60 days, it might be time to consider hiring a Phoenix commercial collections firm. The longer an account is past due, the less likely the client will ever pay. So, bringing in a commercial collections firm to help with those delinquent accounts is often the right solution to improve a business’ revenue collection efforts, as well as remove the burden of collecting on extremely past due accounts from in-house employees.
Alexander, Miller & Associates, LLC is a commercial collections firm that specializes in fast track commercial collections and on-site investigations for businesses of all sizes. Headquartered in Houston, Texas, the firm provides commercial collections services to clients across the nation, including commercial collections clients in Phoenix, Arizona. Contact Alexander, Miller & Associates, LLC today to help with your company’s past due accounts.