Debt Collection - Action Is The KeyIt's a cliche, I know. In debt collection, if you do nothing, you get nothing. The longer I'm involved in the collection and finance industries, the more true this seems to be. Action is the key. Action doesn't necessarily mean court action or referring to a debt collector. Action means sorting out your terms and conditions; maintaining good relationships with your customers; commuinicating early with overdue debtors; having options in place to deal with bad debts; understanding your rights and responsibilities, and so on. If necessary, action does need to be taken in terms of referring to a collector and/or taking the debtor to court. Overall, creditors who take action get more back, after taking into account the costs, than they do by not taking action. It is abundantly clear to anyone who works in the industry, and analyses what works and what doesn't, that taking some initiative is what makes things happen. This may seem blindingly obvious, but there are thousands of businesses in New Zealand incurring unnecessary costs by acting as a bank for their customers. I'm also a firm believer that taking action also puts you in a better psychological space than not taking action. If you are asserting yourself appropriately you will not feel so abused and taken-advantage-of by the debtor. There is a greater sense of control of what is happening, rather than just passively hoping to get paid and letting anger and resentment eat away at you. Taking action will also help a business owner look at their systems and practises.Quite possibly they will make quality improvements relating to their credit control which could have other benefits in the business.
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