Monthly Archives: September 2013

Customer Debt: What to do if Your Customers Aren’t Paying

Collecting on bad debt never became more important than when the latest recession hit businessDebt 2 owners. Scrambling to pay debts of their own, business owners looked at the accounts past due and looked to them for a quick infusion of badly needed cash. But collecting on debt isn’t that easy.

The older a debt becomes, the more difficult it is to collect on it. This is something business owners have known for years and it’s something they’re trying to avoid happening in the first place. Setting up an effective billing strategy can help keep some of the clients from going into customer debt, but strategies like these only do so much – come clients simply won’t pay on time and others won’t pay at all.

Companies that want to make concerted efforts to collect on bad debt will make calls, send emails and offer other payment options to keep their clients from going into past due customer debt. These are common courtesies that help bolster and establish customer loyalty while effectively improving the company’s cash flow. Alas, these tactics don’t work on everybody and some clients will continue to hold out on their payments.

You’ve held up your end of the deal; you provided services, reminded them of their responsibility to pay, offered them flexible payment options and you’re still not getting what is owed to you. Now it’s time to let them know of your intention to turn the account over to collections. Some companies will have their lawyers draft a letter to let them know how serious they are about getting the account current. This ups the level of seriousness on the side of the client and usually evokes a response in the form of payment.

Nobody wants to get sued. As a last-ditch effort, some companies will bring the issue to court where a judge can order the client to make good on the account. No company wants to take their clients to court, but when debt spirals out of control, something has to be done or the business will flounder and possibly crash.

Increasingly, companies are looking to the debt collection industry as the saving grace. The above tactics work when applied by well-trained individuals. But not every company is fortunate enough to find these individuals, which is why they go to reputable debt collection agencies. These agencies have the technology that helps them track down clients with customer debt that is 90-plus days old.

Not only do these agencies have the latest technology, they’ve also got the trained staff that knows how to effectively communicate with debtors. They know how to listen effectively yet establish a professional relationship with the debtor that lets them know they intend to collect on the account. When done right, the collection agency can actually enhance the image of the company for whom they work.

Omega RMS, llc., is a receivable management solutions company that knows all the effective tactics that convinces debtors to get current with their accounts. With a careful eye on the Fair Debt Collections and Practices Act, Omega follows regulations with great attention while helping you to get accounts paid.

Current Accounts Keep Cash Flow Moving: Vital for Small Businesses

Cash Flow 3Cash flow is important for any business, but small businesses are especially vulnerable when cash flow issues arise. Without cash flow, small business can’t purchase the raw products they use to create their inventory of goods.

Small businesses sometimes struggle with paying their staff due to cash flow issues, and everybody knows that the most valuable assets to any business are the people behind it. This is why most companies will set aside their cash on hand for salaries first. But they also have to pay for the advertising that promotes their brand and any other operating expenses related to rent, utilities, etc.

Small businesses can do everything right and still have issues related to cash flow, and many times it’s because of late paying or non-paying accounts. Current accounts keep businesses thriving, but no business has ever had every account paying on time.

Improving the cash flow process begins with a careful study of the billing process. The faster a client is billed, the more likely they are to pay on time. Small businesses aren’t always the best equipped when it comes to offering the latest and most technologically advanced methods in billing. With the right hardware and software teamed with a billing strategy, companies are much less likely to have their clients slip into the no-pay zone.

Even with the best billing strategies, some clients simply won’t pay on time. This is the part of the strategy that involves giving them a quick call or an email that reminds them that the bill is past due. Clients red flagged for late payment in the past can be earmarked for advanced notification that their due date is coming up.

Successful business owners say that cash flow is the single most important fact to their success. Small businesses should prepare a cash flow projection for the year or quarter. Some start-ups with a bare-bones budget will have plans that project for the following week. Regardless of the situation, having those projections in place can help the small business gain a clear picture of where they are and what they do to efficiently operate their business.

Small businesses also find success in taking on a third party to collect their debt for them or manage their billing/receivables process. For a small fee, they never have to worry about billing as their receivables are sold up front and they get immediate payment, which produces positive cash flow. With cash in hand, these small businesses can pay for the items that help them see faster growth.

Omega RMS, llc. has a variety of services that can improve a company’s cash situation. From accounts receivables management to early intercept recovery services to contingent collection services, Omega has solutions that fit companies in many industries. Their mission is to ensure that all their solutions are serviced appropriately, and after more than four decades of offering these services, many, many small businesses can attest to that mission.

Let Collection Specialists Work for Your HealthCare Organization

It’s an unfortunate fact of life – medical expenses can be the biggest expense a person will incurMedical Bills 1 in the course of their lives. Most of us hope it’s the house and the car that make up the bulk of big-ticket items, but as a generation of baby boomers is coming to discover now, serious medical issues come with a large price tag. Not all of those expenses will be covered by insurance and many just don’t have the savings to pay for it.

As the nation struggles over the healthcare debate, countless healthcare organizations are trying to determine how to collect on unpaid medical bills. Many have attempted to establish their own in-house collections departments, which many times consists of one person devoting a portion of their day toward collecting on unpaid bills. But those operations can be inefficient, and time consuming. What they need is an organization as trained in collections as the healthcare professionals are in treating illnesses. They need collection specialists.

Healthcare facilities also need a partner that can integrate seamlessly and represent them ethically and efficiently. A very small group of collection agencies have made headlines for their unethical practices, which puts up a barrier between the reputable agencies and companies that could positively affect their cash flow by reaching out to them.

Partnering with a collection agency has a range of benefits, but healthcare organizations considering collection specialists should consider a few tips before signing up with one. First, make sure the agency has experience in the healthcare field. Most agencies will focus on a handful of industries, which makes them more qualified. Second, make sure they’re fully licensed and able to do business in all 50 states. Being fully licensed should mean that they are insured and bonded as well. If a debtor lives in a state other than the one that the bulk of your patients reside, the agency needs to be licensed in order to contact that debtor.

The agency being considered should also be willing to turn over audited financials to ensure they’re on the up-and-up. Can they handle an account that is more than 180 days past due? Some will tell you up front that they only handle accounts that are less than three months past due – make sure to ask, because collecting on older debts takes skill and you want to be able to trust that your collection specialists are able to get back all the money that is owed to you, whether it’s two weeks past due or 18 months past due.

Omega RMS, llc., is a company that has for 40 years represented its clients with ethical and professional services, from accounts receivables to loan servicing to strategic contact campaigns and collection services. Utilizing technology and extensive training and experience, Omega professionals provide a service that not only increases cash flow, but protects their clients’ public image.

Collection Solutions Valuable as Uncollected Debt Rises

Debt 1The number of consumers late on their accounts has reached near record numbers according to a recent report.

The Quarterly Report on Household Debt and Credit published in August 2013 shows that the majority of consumers are in credit card debt, followed by mortgage debt and auto loan debt (nearly tied). Student loan debt recently surpassed the debt incurred through credit cards, but there aren’t as many former students in collections for defaulting on their loans as there are late-paying credit card account holders

The report shows a decline in delinquent credit, but consumers with one or more credit report trade line with a third party debt collection agency remained near it’s high point. Nearly 15 percent of consumers in the U.S. have a credit report that shows a third-party debt collection. The average balance on these delinquent accounts is around $1,400. The highest ever recorded was in the second quarter of 2012 when it hit $1,550.

Economists aren’t worried about the statistic because most of the bulk of the money tied up in collections belongs to medical and utility bills, leaving only a smaller percentage of consumers in collection for their credit accounts.

While the report doesn’t try to explain why the number of accounts in collections remains high, there is no doubt that companies are benefitting from the services that collection solutions provide them, which means a greater number of companies could be seeking out those services.

Collection agencies provide collection solutions that bring back billions of dollars a year to companies that otherwise would probably write-off those accounts as losses. Most companies don’t have the manpower or technology to pursue debts that are more than three months old, but collection agencies are equipped and trained and can make contact with debtors that seem to have fallen off the map.

Collection agencies follow the Fair Debt Collections and Practices act, which offers an excellent guideline for ethical and legal activity. Reputable agencies will follow the federal and state guidelines to stay in compliance as well as respect consumers. It’s this type of relationship between the collection agency and the consumer that protects the public image of the company’s that connect with agencies to pull back some of those losses.

It makes fiscal sense for companies to do what they can to recover debt from their clients, but after a certain point, their abilities are not where they need to be to collect on that debt. Old debt (90 to 120 days past due) is especially difficult to collect on. It’s at this point that partnering with a collection agency makes better fiscal sense than wasting company resources on collections.

Omega RMS, llc., has the tools and resources needed to reach out to debtors. The state-of-the-art technology is used in conjunction with a staff of well-trained professionals that know how to provide an ethical service that protects brand image and boosts cash flow for clients.