Why you should outsource debt collection
In Denmark, there are many skilled and competent debt collection companies and lawyers specializing in debt collection. To be precise, there are 65 authorized debt collection companies that can help your company with debt collection.
Whether you choose Collectia as your debt collection partner, one of our competitors or a debt collection lawyer - our years of experience tell us that outsourcing the debt collection function for most companies is both profitable and time-saving.
But why should you outsource your debt collection - instead of letting your accountant do it?
We've put together 5 tips on why we think you should outsource your debt collection to us, a competing debt collection company or a debt collection lawyer.
1. frees up time and resources
Whether you choose a skilled debt collection lawyer or a debt collection company to handle your debt collection - your bookkeeping will undoubtedly experience more time and more resources.
For sending reminder letters, debt collection notice, calls to the debtor, installment arrangements, dialog with the debtor and possible processing in the enforcement court - takes time from the bookkeeping. Most lawyers and debt collection companies take care of the whole process - often much cheaper and more efficiently than you can do it yourself.
...and hey, why not spend time on the customers who pay and let the lawyer or debt collection company take care of the ones who don't?
2. Save money
Most lawyers and debt collection agencies nowadays offer very low prices - or even free debt collection in the form of "no cure - no pay", where you only pay if they recover your money. If they don't get your money back, collection is free.
Example: Your customer owes you DKK 1000; a debt collection company will typically charge 10% if the case is resolved - i.e. DKK 100. Can your hourly-paid bookkeeper send reminders, debt collection notices, etc. for just 100 kroner?
Whether you choose no cure no pay, a subscription solution or an entirely 3rd party solution, outsourcing the debt collection function is often very cost-effective in both the short and long term.
3. All processes and fees are respected
There are many skilled debt collection companies and lawyers specializing in debt collection in Denmark - and one thing you can be sure of is that all formalities and processes are in order and all the right fees are imposed and complied with.
This benefits you, the debt collection company and, most importantly, your customer.
Unfortunately, we often see companies' in-house bookkeeping function forgetting important fees or not respecting the legal deadlines that apply. This will not happen when you outsource your debt collection.
4. A one-stop solution - from reminder to enforcement
Many debt collection agencies and lawyers nowadays offer afull-service solution, where they assist your business with everything from the first reminder letter up to and including enforcement proceedings.
This allows you as a business to put your debtor management on autopilot - without having to spend time reminders for late payments.
5. At a glance
Many debt collection companies have good systems to give your company a good overview of your debt collection; who has paid, who has made an installment agreement, which cases are open, which cases are closed, etc.
An overview that makes it easy for the company to keep track of all actions - and thus what is happening with your debt collection cases.
Do you handle your own debt collection today?
If you are an accountant and are responsible for your debt collection - talk to us about what options you have. And if you are not yet ready for a solution, remember that we have a universe of free templates for reminders, debt collection notices and much, much more right here:
Debt collection warning template
Free e-book: 8 free debt collection tips - how to deal with bad payers
