Johannesburg - Every business must determine whether it should perform a function such as debt collection in-house or outsource the task to a specialist agency, according to Tracey Swart, debt recovery company Blake Group’s global head of sales.
The decision to outsource depends largely on the skills set, capacity and budget of the company.
Many companies do not have the internal resources or skills to allocate costly time to the task of recovering debt.
"Outsourced debt recovery works on a variable percentage of the debt recovered, which means the costs are kept to a minimum and you only pay for success. These collection agencies are also able to scale up or down at short notice, thus offering flexibility," according to Swart.
The strategies employed by outsourced debt recovery teams include tracing debtors, collection prioritisation, concluding acceptable payment arrangements, monitoring of unpaid debt, as well as enforcement via the legal system if required.
"These debt recovery companies would normally have sophisticated collection software which permits daily segmentation of accounts. The best teams focus on customer experience management too – the goal should be to recover debt and retain customers," said Swart.
"There has been a significant shift towards managing the customer experience in business. Ensuring that a customer is treated fairly is crucial, even in the debt collection industry, as this will uphold the company’s reputation."
Trends in the UK have shown that outsourced debt recovery companies typically have the skills and time to monitor the customer’s experience. And international trends, particularly in Europe and the UK do influence the SA market.
"Our legislation and conduct is often driven by changes and advances made in those markets which are introduced here. As a result SA is well placed to provide efficient effective and more cost effective solutions in the outsourced arena, without compromising customer service or experience," said Swart.