If you are a business owner or departmental manager who has already made the decision to hire a collection agency, you may be wondering what the advantages are to an international collection agency versus a national one. The truth is that any owner or manager with receivables outside of North America has good reason to hire an international collection agency. The same is also true for foreign companies with debtors in the United States or other countries. Following are some of their benefits.
As you probably know, a debt collection agency in general has much higher success rates at recovering debt. In addition, taking your staff off of activities that build business like sales or marketing in order to do debt collection is a poor idea and doesn’t work well. Collections activities that are assigned to salespeople or accounting staff are usually last on the list of things they want to get done.
An international collection agency will be even more suited to solve your international collection problems because they will have familiarity with thorny issues such as local laws, time differences, customs and language barriers. International collections are even more complicated than regular collections and should be handled by professionals.
An international collection agency should be called in right away so the debt can be promptly recovered in a professional manner. You’ll get more money back more quickly this way. In addition, you don’t have to pay up front for the services so it won’t affect your cash flow, and you won’t give your own staff the impossible task of dealing with unfamiliar languages, culture, and laws in an inconvenient time zone.
The reason an international collection agency is preferable to a national one is the same reason that having a collection agency of any kind do your collecting is preferable to doing it yourself. The international collection agency will have people in place who know the language and culture of where they’re collecting, while operating during optimal business hours. They’ll also have people on staff who are aware of local laws and which jurisdiction governs transactions in the case of a dispute.
Say you’re collecting in Asia. Even if the national agency has people on staff who are fluent in some of the major Asian languages, like Japanese, Korean or Cantonese, they will not necessarily be familiar with the laws and customs of each individual country, and even if by some chance they are, they will still have trouble being effective due to the major time zone differences unless they employ people around the clock.
An international collection agency can also maximize your profits due to working exchange rates. If the currency in the area in which they collect is strong, they can work a deal with the debtor where the amount on the debt paid off is lower in the local currency, but you get more thanks to the vagaries of exchange rates.
Possibly the most important advantage of an international collection agency is their ability to find deadbeat debtors. Private investigators have jurisdiction and capabilities locally, not internationally, in most cases. To find someone who’s hiding in a foreign country you need to use local investigative services, which means hiring an international collection agency that uses or incorporates an investigation firm.
David P. Montana has written extensively and served as a business consultant in debt collection agencies services for three decades. David provides additional beneficial tools and information about international collection agency services.