Debt collection in Melbourne is becoming a real problem for Melbourne businesses.
In good economic times cash flow is usually disregarded, to a large degree, because sales are booming and there is always money coming in to pay the bills. With the Melbourne economy tightening up, along with that of the rest of Australia,Ã‚ the ready supply of sales is decreasing and many Melbourne businesses are having to look at reducing their overdue debts as a necessity to enable then to meet their own overheads. A recent survey by a major bank showed that cash flow and outstanding debts were among the main problems facing Melbourne small - medium businesses.
As with other large Australian cities, Melbourne debt collection is never easy and is a job put of by most business owners. Many dislike having to contact their debtors and ask for payment, or worst still, put the debts into the hands of one of Melbourne\'s many debt collecting agencies. They see the later as a final step and only something to be used on large debts. The fees and 20% plus commission deters many from taking this step, along with past experiences of debts put in the hands of debt collectors remaining unpaid. Like all Australian business people, Melbourne businesses hate the idea of throwing good money after bad.
To be effective, the debt collecting process has to be initiated as soon as possible after a debt becomes overdue. Research has shown, time and time again, that the chances of collecting an outstanding debt diminishes directly in proportion to the time taken to start debt recovery procedures.
The initial stages of debt collection needn\'t be expensive. They involve contacting the debtor, reminding them that the debt is due, and letting them know that you expect payment. They must be made aware that this debt is not going to go away and that you will be using stronger methods of debt collecting in the future.
Swift action is the key here. Assuming that your debtor does have some money at their disposal, the old adage of the creaking hinge getting the most oil comes into play. Many debtors, when faced with more outstanding debts than they have the ability to pay allocate their money to those businesses that they perceive to be the biggest threat or problem to them.
The use of Australian debt collecting software , like iCollect, allows Melbourne businesses to operate their own debt collecting system efficiently and cheaply. The idea behind iCollect is that you handle all the initial debt collection using the same letters that the Guardian Debt Collection agency does, complete with the Guardian letterhead. Experience shows that using these initial letters can result in up to 95% of outstanding debts being paid within a very short time, (over 60% after the first letter), without the need for further action. All you have to do is enter the debt details and the system takes over, printing letters when they become due. The cost is only $8.60 per week, which most business owners will agree is a very small amount to pay to be rid of their Melbourne debt collection problems once and for all.
Visit the Author's website: http://www.australiadebtcollection.com.au