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How To Improve Third Party Collections During The Most Challenging Time Of The Year And Improve Performance

by Phillip Thomas, Vice President of Sales, Convergent Outsourcing, Inc. - July 12, 2017

How to Improve Third-Party Collections During the Most Challenging Time of the Year
By Phil Thomas, Vice President of Sales, Convergent Outsourcing
 
The days of dial, dial, dial are a thing of the past in the third-party collection world. Today, contact strategies are driven by analytics, not only in an effort to enhance profitability and maximize client performance, but to minimize the risks they face with more regulatory oversight. Never is that more true than at the end of the year.
 
This is typically the most difficult time of the year for recoveries as many consumers are focused on holiday spending as opposed to paying delinquent debt, although collection agencies actually put more money in consumers’ pockets. According to ACA International’s report, “The Impact of Third-Party Debt Collection on the National and State Economies,” the collection industry saved the average American household $389 in 2013. This amount represents dollars households would have spent if businesses were forced to raise prices to cover bad debt.
 
With debt recoveries being lower in November and December and companies often running leaner on staff, putting the right accounts in front of your agents at the right time is critical to both maintaining profitability and providing the desired result to your clients. Here are some strategies to help improve third-party collections at the end of the year:
 
Scoring – There are a myriad of suppliers that provide propensity to pay scoring at a price.
 
Internal Data – Utilize your internal data as a way to predict the outcome of a consumer interaction based on historical events or a lack of response.
 
Resources – Compare incoming accounts against existing inventory and demographic information, you can spend more time dialing good phone numbers and less time “spinning your wheels” on dials that you have identified as a bad number on another account. This also goes a long way in mitigating risk to both you and your client. Many of the complaints and lawsuits that collection agencies endure are the result of an agency repeatedly dialing a third-party on a wrong phone number.
 
Tools – Be certain your agents, both experienced and new ones, are very knowledgeable and confident with the tools at their disposal. Does your client allow settlements on their accounts? If so, what are the parameters? Are the representatives up to speed on what payment arrangements are acceptable?  Mastering the basics can lead to a positive outcome for the consumer, your company and your client.
 
To take it a step further, if a consumer has had a previous account in your office that was resolved with a settlement, or a settlement offer has been extended via a written communication, a less tenured agent may be effective. On the other hand, if the anticipated outcome, based on historical behavior, is a payment plan, a more experienced negotiator may be required to achieve the desired outcome for all parties.
 
Historically, collection agency recoveries will be at their highest in the first four months of the year, as will profits. That is the “easy” part. The final few months of the calendar year are the most challenging from a competitive and profitability standpoint. By utilizing analytics and data analysis, companies can intelligently deploy their resources on the right accounts. They can also avoid spending money and intellectual capital on the wrong accounts. By putting the right records in front of the right collectors at the right time, you can dramatically improve your year-end performance.
 
About the Author:
Phil Thomas is vice president of sales for Convergent Outsourcing Inc., customer engagement outsourcing solutions that deliver the people, processes and technology to improve efficiency, ensure compliance, and increase customer satisfaction and lifetime value for our clients. Our contact center solutions support customer acquisition, customer care and retention, welcome programs, accounts receivable, back office processes, crisis response and other critical communications. Phil may be reached at pthomas@ConvergentUSA.com.
               
 
 
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