Making a profit in the towing industry is hard work. On the one hand, you’re focused on promoting your services and diversifying your portfolio to bring in as much business as possible. Conversely, you’re managing many expenses, from leases to workers’ compensation and payroll. One cost that many small business owners struggle with is that of unpaid work. Hiring a debt collection agency is a smart solution to navigating tricky laws and recovering as much income as possible.
What are debt collection agencies?
What are debt collection agencies?Debt collection agencies are professionally licensed organizations that specialize in recovering past-due accounts. They are instrumental in ensuring you are paid for the work you complete. Even though you may be holding an automobile as collateral, these companies will help you turn that collateral into revenue on your bottom line.
How does a debt collection agency work?
Debt collection agencies typically work on a commission basis for recovered assets. For example, an agency may charge a fee of X% of all funds recovered. This is a win-win situation for you because it means they will prioritize their work to achieve the highest dollar value of recoveries, which will significantly impact your profitability.
Why not hire your own employee for debt collection?
Sometimes small businesses will either assign debt collection work to a spare employee or hire someone as a dedicated debt collection employee. The risk is keeping up with and adhering to stringent federal and state regulations for debt collection. For example, federal law regulates debt collection with the Fair Debt Collections Practices Act (FDCPA.) This regulation sets limitations for when and how customers can be contacted, standards for communication, and requirements for disclosures, among other details surrounding the work. If you fail to follow the FDCPA or similar state regulations, you may be subject to fines and penalties.
How to select a debt collection agency:
Your debt collection agency will be working as your partner to recover money on your behalf, so it’s important to research your options and make a well-informed decision about which company to hire. Some of the questions you should ask potential debt collection agencies include:
- What processes do you use to locate debtors?
- What are your procedures for contacting debtors? What sample scripts do you use when communicating with them?
- What is your fee structure?
- How do you train your employees on the FDCPA and other state rules for debt collection?
- What are your recovery rates for similar businesses?
Also, review their credentials with the Better Business Bureau and your state’s attorney general to ensure they are appropriately licensed and have a good reputation.
How can Collins Manufacturing help?
We have a history of working with our customer companies to help them achieve success. While you’re focused on running your business, allow our pros at Collins Manufacturing to introduce you to top-of-the-line towing equipment your employees and customers will love. Our Collins Manufacturing’s Hi-SpeedⓇ Dolly and Carrier Dolly systems are easy, safe to operate, light to transport, and durable to handle the toughest towing jobs. By providing our towing solutions for your employees, you’ll make their lives easier and see their job satisfaction grow.
Collins has been an industry leader in towing equipment for over 45 years. Our Hi-SpeedⓇ Dolly and Carrier Dolly systems provide towing professionals with lightweight solutions durable enough to get even large vehicles out of challenging situations and transport them safely wherever they need to go. Our products are designed with safety first to keep your employees safe while attaching and moving vehicles. Visit our website or give us a call to learn more about our products.
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