Do you have a business that offers goods and services on credit? Are you finding this process time-consuming and often ineffective? It may be time to consider outsourcing this function to a third party.
Choosing the right team of debt recovery lawyers to recover debt on your behalf can mean the difference between a cost-effective, successful recovery and a long-drawn-out failed attempt. If you’re still on the fence about outsourcing your business debt, then this post is worth a read.
Debt Recovery Shouldn’t be Stressful
Anyone who has ever attempted debt recovery after they’ve already delivered goods to a buyer knows how stressful the process can be. This is especially true when you’re expertise lies more in selling and marketing your goods than fighting for your money.
You can avoid this frustrating aspect of your business by enlisting the services of lawyers who specialize in debt recovery. We’ve compiled a quick list of the top benefits that you and your business can look forward to when you outsource your debt recovery.
1. You’ll Have Access to Expert Legal Advice
The number one benefit of outsourcing your debt recovery is that you’ll have access to expert legal advice. This often means having a more comprehensive understanding of the various processes to follow at different stages of the collection process.
Typically, you can also expect advice on various debt collection strategies that may make the process more efficient. Some of these include the following:
- Negotiate reasonable payment plans
- Provide the most effective approach to each individual case based on its unique merits
- Make legal recommendations for alternative dispute resolution
- Initiate and navigate the various steps of legal proceedings when necessary
Sometimes, this process can be as simple as sending a legal letterhead to your defaulting customers.
Moreover, some law firms offer flexible payment structures, including success-based fees. This means you only pay a portion of the recovery cost once the outstanding debt has been successfully collected. This approach helps businesses manage their cash flow effectively, making it easier to pursue debt recovery without incurring upfront financial burdens.
Many defaulters respond to your requests for payment once they see how serious you are about recovering your money.
2. Lets Your Customers Know You Mean Business
It’s not uncommon for defaulters to ignore your request for payment if you’re a small business owner. This usually happens because some customers don’t take small businesses seriously when it comes time to honour their agreements.
Enlisting a lawyer lets your debtors know that you’re as serious about debt collection as you are about your marketing efforts. Receiving a letter of demand from your lawyer may be all the nudging they need. Since the lawyer’s letter will advise the defaulter of potential legal action if payments aren’t made, your customer’s will know you mean business.
3. There Are No Hidden Costs
Your debt recovery lawyers will also be upfront with you when it comes to their costs. This means that you won’t have to deal with hidden or unforeseen costs when you get their invoice. Since many lawyers charge fixed rates, it’s much easier to factor these into your budget. In many instances, these payments can also be recovered from your defaulting customers.
4. Adds Professionalism to Your Brand
Enlisting the services of a lawyer instantly adds a sense of professionalism to the overall process. Debt recovery lawyers will negotiate on your company’s behalf, and this will be done sternly but professionally.
That means there will be no threatening or harassing behaviour. Rather, action will be taken following a legal process and the customer will be given a reasonable amount of time to respond to each step of the process. This system is not only more effective but doesn’t negatively affect the reputation of your brand.
5. Protects the Rights of Your Business
It’s not uncommon to be bombarded by defaulters who want to point out that they have rights as customers, which they believe you are infringing on when you request money owed to you. Navigating your way around these types of scenarios can be tricky, especially if you’re not sure how to legally approach these arguments and you also don’t want to harm your business reputation.
Fortunately, debt recovery lawyers are well versed in ensuring that debtors don’t take advantage of you. They will also help you legally deal with any of the following issues:
- Making false claims about customer service not being adhered to (as an excuse to avoid payment)
- Blaming product quality for non-payment
- Continuously breaking payment arrangements
- Harassing you and your staff
Your lawyer will ensure that the situation is handled professionally, and objectively. If there are any valid customer complaints that could be hampering payment, they will also advise you of the best way to resolve these as quickly as possible.
Final Thoughts
As a business owner who offers credit you’ll soon find out that this process can be challenging. Sometimes it may seem as though you are dealing with a whole different customer when it’s time to collect what’s owed to your business.
By enlisting the services of a debt recovery lawyer, you will be able to keep your focus on aspects such as marketing and running your business. Doing this allows your team to concentrate on what’s important while your lawyers use their legal expertise and professional skills to collect what’s owed to your business!
