collection agency
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I'm assuming you've looked into it and assured yourself that they'll add value?
My experience has been that the collection agencies end up taking about 50% of the outstanding debt as commission. The alternative is that they'll buy the debt off you for about $0.50 on the dollar.
Just sayin - depending on how much money you're owed, it might not really be worth it.
This info comes from a past life so it could be a little old but I really doubt the industry has changed that much.
My experience has been that the collection agencies end up taking about 50% of the outstanding debt as commission. The alternative is that they'll buy the debt off you for about $0.50 on the dollar.
Just sayin - depending on how much money you're owed, it might not really be worth it.
This info comes from a past life so it could be a little old but I really doubt the industry has changed that much.
Really? How so? We've had absolutely NO issues what-so-ever using a collection agency. The success rate on recovery has been better than 60%. Never had any legal issues.
Assuming that your business is global how do you handle collections outside the US? Isn't it relevant there seeing how each country imposes different laws on that? :smash:
I have found and read about some agencies on some website, but I really can't remember where it was... I'm going to do some digging on this and will respond back as soon as I have found them. I'm wanting to say that it was on Quickbooks Apps.
Actually I found them, have you checked out any of these:
FundBox
Funding Gates
InvoiceSherpa
ARCollect
NOWAccount
CollBox
ItsPayd
These are just some of the apps and items offered by Quickbooks Online AR Apps
I am not sure if any of them are any good, but these items integrate with Quickbooks Online.
Just FYI.. if you are interested in getting Quickbooks Online edition for your business for FREE, just sign up for the 'Accountant' edition and you get Quickbooks Online edition FREE for your business and your own books. All the same great features of all the other editions of Quickbooks, plus you can manage your client's Quickbooks accounts too, if you do accounting as a part of your business, we don't, so we don't use that feature, but just use it for the 'Free Quickbooks Online' and it works great!
Actually I found them, have you checked out any of these:
FundBox
Funding Gates
InvoiceSherpa
ARCollect
NOWAccount
CollBox
ItsPayd
These are just some of the apps and items offered by Quickbooks Online AR Apps
I am not sure if any of them are any good, but these items integrate with Quickbooks Online.
Just FYI.. if you are interested in getting Quickbooks Online edition for your business for FREE, just sign up for the 'Accountant' edition and you get Quickbooks Online edition FREE for your business and your own books. All the same great features of all the other editions of Quickbooks, plus you can manage your client's Quickbooks accounts too, if you do accounting as a part of your business, we don't, so we don't use that feature, but just use it for the 'Free Quickbooks Online' and it works great!
easyhostmedia
Well-known member
what a load of bull.
If you have a legitimate business and someones owes you money you have the legal right to employ a collection agency to collect monies owed to yo, no matter what country they are from.
The point of International Collection agencies is that you deal with 1 agency in your own country and this agency will deal with any agencies in the country the debtor is from. This method is more expensive as you have to pay fees for more agencies.
before appointing any collection agencies you have to weight up the costs and see if it is worth chasing the debt.
In the UK we first send out an LBS (Letter Before Action), this gives the debtor 14 days to pay the debt.
We use Express Debt Collection who deal with all the process from LBA automatically
their charges are as below
so nowhere near the 50% wh-coach say these agencies charge
easyhostmedia
Well-known member
that is why you would use an international debt collection agency as they would deal with other agencies in other countries that work within each countries laws on debt collection.
zomex
Member
That's interesting Terry I never thought about web hosting and collection agencies.
I'm sure it's worth doing when you get into big depts such as for dedicated servers etc
Zomex makes a good point. It wouldn't be worth chasing down small arrears, but the larger amounts, sure. Although, I don't see how an American debt collection agency would chase down arrears in Australia. Unless they sell off the debt to an Australian agency.
easyhostmedia
Well-known member
That is what international debt agencies do.
How it works is that you will pass the debt to an international debt agency in the USA to collect a debt from a client in say Australia.
the agency in the USA will have either contact a branch they have in Australia or an associate agency they work with, who will chase the debt for them, but you only deal with the agency in the USA
easyhostmedia
Well-known member
Normally a Letter Before Action does the trick. as the agency i use cost nothing unless they collect i have nothing to lose.
Before I started using them an agency i used would charge £1 for an LBA and then if that failed you had to instruct them to go further, so never really went further than LBA as it was not worth it.
Only once i took a debt all the way using the small claims route after an ex client become abusive after getting an LBA for not paying his hosing fees.
he ended up with a CCJ and by the time it ended up in the northampton claims court his £25 non payment ended up costing him nearly £300.
If he had not become abusive it would have not went any further than the LBA
I don't understand the rude condescending tone here... I was also referring to the US system. We've dealt with collection agencies and gotten nothing in return. We know how it works that's not the issue. The issue was that we got no results with the two agencies we tried. I'll look into the escallate.com site and make inquiries.
If we are looking at $100 in unpaid debt sure, we'll go for it. But small $10 or so VPS accounts? A collection agency is going to spend time with those? I just don't see that happening especially with the fees involved but I could be wrong.
Also, there is the issue that past non-paying clients may end up harming you in other ways on the Internet if going the collections route. Sometimes you just move on and reload a server/VPS.
The main issue here is; are you getting any worthwhile results?
Any further advice from US hosts appreciated...
If we are looking at $100 in unpaid debt sure, we'll go for it. But small $10 or so VPS accounts? A collection agency is going to spend time with those? I just don't see that happening especially with the fees involved but I could be wrong.
Also, there is the issue that past non-paying clients may end up harming you in other ways on the Internet if going the collections route. Sometimes you just move on and reload a server/VPS.
The main issue here is; are you getting any worthwhile results?
Any further advice from US hosts appreciated...
easyhostmedia
Well-known member
how can it be rude and condescending when pointing out your statement is wrong
no matter what country you are in Web Hosting is a service industry where a client agrees to your Terms of Service (contract) to pay you a fee to host their website. If they dont pay then they have broken the TOS and you have the right to recover monies owed. if that means employing the services of a debt agency then that is what you do.
Yes a lot of the times it is not Financially Viable to use a debt agency, but nothing wrong in sending a Letter Before Action to the non paying client for the cost of a stamp. Most of the time this will be enough to force the client to pay. This is the same process that can be used in the USA.
If a client does not pay then you can either just write the debt off or take further action.
Even when we send LBAs and nothing happens and we have terminated a clients account we still leave unpaid invoices on our system incase these clients try and join us again ( it has happened in the past) then we can stop them until they have paid the outstanding invoices.
How? One thing is to point out if a statement is wrong (in your opinion). Another is how to do it.
Sometimes one little line makes all the difference:
Reply #1: Nice.
Reply #2: Not so nice.
We pride ourselves as being known as a friendly community. At all times. Please, let's keep it this way.
Believe it or not, I used to work for a collection agency. Yep, carried a baseball bat in the trunk of my car. Of course, it was all local stuff. At that time, the charge was 33%. Recovery rates in the collection industry are not very high.
I think the main issues with international debt recovery is the application of laws in different countries.
Sure, an agency can send letters for you to chase the debt and make loads of phone calls. But they're not about to send someone to Timbuktu to claim an outstanding debt unless it's a major sum.
In this industry, in most circumstances, the amounts we need to chase just aren't worth it and the customers who owe them know this. If it's domestic to where you do business, that's a slightly different story.
As @SenseiSteve says, collection rates in the industry are typically low. In the UK, we have very good laws which give bailiffs powers, but other countries just don't have them quite the same.
Sure, an agency can send letters for you to chase the debt and make loads of phone calls. But they're not about to send someone to Timbuktu to claim an outstanding debt unless it's a major sum.
In this industry, in most circumstances, the amounts we need to chase just aren't worth it and the customers who owe them know this. If it's domestic to where you do business, that's a slightly different story.
As @SenseiSteve says, collection rates in the industry are typically low. In the UK, we have very good laws which give bailiffs powers, but other countries just don't have them quite the same.
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