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W EEKLY EDITION NOV 1, 2017 Getting Paid Part III: Choosing a Collections Partner …continued Adapted for the PSAI from articles in Business News Daily and Rocket Lawyer While there are many reputable collection agencies, some bad actors have caused the industry to earn a bad reputation. A few agencies have been known to use questionable, harassing or illegal tactics to collect. You want to avoid that sort of thing at all costs becau se it reflects poorly on your business. These days there are strict laws surrounding collections efforts, and any reputable agency will follow them. Many people confuse collection agencies with debt buyers, although there are distinctions between the two. Debt buyers purchase debt for a reduced price — sometimes pennies on the dollar — and keep all the money they collect. Collection agencies, on the other hand, are paid a percentage of any outstanding debt they recover, but they don't own the debt. When th ey collect a debt, they hand the money over to your company, minus a certain percentage in fees. If you want to consider hiring a collection agency, it is important to do your research first to understand what separates th e good ones from the bad. It is a lso important to find a collection agency that is experienced, professional and familiar with the portable sanitation industry. Not every collection agency will be a good fit. When to hire a collection agency Most companies send accounts to a collection a gency when they are between 90 and 120 days past due. If you wait longer than that, you're far less likely to recover the debt. The more time that passes, the lower the chances. Generally, it 's time to start thinking about hiring a collection agency if: • N ew customers do not respond to your first attempt to collect the debt. When you do not have a history of transactions with the customer, there's a greater chance they will refuse to pay. • You've agreed to a payment plan, but the customer does not follow thr ough. Customers who still won't pay after you've agreed to meet them halfway with a payment plan are unlikely to change their minds. • A customer completely denies responsibility for the debt. Without a collection agency, these debts are rarely recovered. • Th e customer makes unfounded complaints about your business, product or service as an excuse not to pay. Most of the time, these complaints are just an excuse to get out of paying the debt. • The customer has a long history of being financially irresponsible. Once you've exhausted your options and aren't getting anywhere with a customer on your own, the debt is better left in the hands of a professional agency that may recover at least a portion of what you're owed, if not all of it. Choosing a collection age ncy There are literally thousands of collection agencies in the United States alone, and they are not all alike. Some handle consumer accounts, while others specialize in business - to - business (B2B) collections, also known as commercial collections. The big gest firms often handle both. PAGE 2 CONTINUED ON PAGE 3