Why Debt Collection Is Essential to a Good Economy
Every commercial company is in business for one purpose and one purpose only - to make money. Payroll is an expense. Inventory is an expense. Rent and utilities are expenses. Commercial companies have bills that need to be paid in order to keep the doors open and payroll met. When customers do not pay their bills on time - or at all - this can place any endeavor in jeopardy.
Businesses cannot survive without Income
Entrepreneurs and small business owners have put everything on the line to keep their companies running. When solvent customers refuse to pay bills on time it hurts the entire team. Sometimes these are long-standing customers and other times they are just one-time purchasers. Company managers do what they do best - run their operations. Taking the time to chase after late payments can take valuable time away from vital daily responsibilities. There should be no hesitation or embarrassment in asking for outside help in collecting these debts.
Professional collection agencies help businesses receive the payments they are owed. It is their specialty. And they are very good at what they do.
There Is No Good or Bad Party in this Transaction
The equation is very simple. Company A produces a custom order for Company B. Company B is not paying the bill. Company A had to invest in raw materials, utilities and payroll to complete the order. The total invoice is not all profit. Whether the seller is on a 25% or 50% margin, he is still out the initial investment. Plus his margin is not available to pay other bills.
He could be late with some of his vendors which creates a circle of lack of income. It is a trickle-down effect. The vendor has the same expenses as his customer, so now his sources are not being paid. Professional Collection Agencies keep the wheels of industry greased by getting money to the person at the top of the chain so it can trickle down to all the other businesses depending on it.
Struggling Businesses can make a Comeback
By outsourcing the collection process to the professionals, business owners can reap the money they are owed. This influx of needed capital can be used to pay older bills, reinvest in equipment and training that will increase productivity or expand in order to continue growing. Getting paid the money you are owed is not a gift. It is what you worked hard to earn. Do not ever be embarrassed or hesitant to go after it.
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