It seems every time there is a faint glimmer of hope for Canadians, new challenges pop up.
The inflation rate slipped down again last month — and now Canada’s carbon tax kicks up another notch, which will increase the cost of nearly everything that requires transport or energy, from diesel fuel to grocery store heating bills. And despite the talk and positive statistics, not many of us seem to have yet felt any real relief on our own household or business budgets. Slowing inflation means costs are not rising quite as fast, but they are still going up. And up.
So, with inflation and interest rates still painfully high and margins smaller than ever nearly across the board, businesses across all industries are looking for effective ways to minimize financial losses and maintain reliable cash flow.
One super important piece of this is to partner with a reputable collection agency. Here, I’ll explore the top 10 reasons why using a collection agency can be particularly beneficial when inflation is high and uncertainty continues to lurk around every corner.
- Recover Delinquent Accounts. The most obvious reason to use a collection agency when inflation is high is to recover delinquent accounts. Consumers and businesses tend to prioritize paying bills that are coming due and highest priority, so if you wait too long to act, there’s a greater chance there is a problem that will result in the debt going unpaid. A collection agency can help you recover those funds more efficiently. Even a few days past due should be a red flag, and your response sets a precedent.
- Optimize Your Resources. Trying to collect on delinquent accounts can be incredibly time-consuming and resource-intensive. By outsourcing this task to a collection agency, you can free up your team’s time to focus on other important parts of the business. Collection agencies do nothing but collect, all day long. So we’re highly effective at it.
- Improve Debt Collection Results. Our collection agents are highly trained experts at recovering overdue accounts. We have the tools, skills and knowledge to track down delinquent debtors, negotiate payment plans, and collect outstanding balances. Inflation doesn’t change these facts, but the constant erosion of value makes it urgent to get receivables into your cash flow quickly.
- Preserve Relationships With Debtors. When you use a collection agency, you can preserve relationships with your debtors. Instead of relying on your employees to take on this uncomfortable task, a third-party collection agency can handle it with professionalism, empathy, and respect. Good customers will come back. And the bad ones can go trouble your competitors.
- Reduce Legal Risks. Many businesses aren’t familiar with debt collection laws and regulations. By outsourcing this task to a professional collection agency, you can reduce your legal risks and avoid costly mistakes. (At MetCredit we have an in-house legal department for if things get challenging, and to proceed cost-effectively if further action is needed.
- Maintain Cash Flow. Inflation can put a significant strain on cash flow. By working with a collection agency, you can help ensure that you’re getting paid on time and maintaining a consistent cash flow, even as inflation continues to rise.
- Save Money. While some business owners can be hesitant to work with a collection agency due to the perceived cost, the reality is that doing so can actually save you money in the long run. By recovering delinquent accounts more efficiently, you reduce your bad debt write-offs and improve your profitability. And if we are unable to collect, there is no cost to you. Once you’ve worked with us, you’ll never want to go back to the old ways.
- Increase Productivity. When you don’t have to handle the burden of debt collection yourself, you can increase your team’s productivity and focus on other important tasks. Sending overdue accounts with our unique system is quick and easy. Reach out and we’ll have you set up in no time.
- Manage Your Financial Risks Better. By using a collection agency to recover delinquent accounts, you can better manage your financial risk exposure. High inflation is proving unpredictable, but working with a collection agency is a predictable solution that gives you a clear path forward.
- Expand Business Opportunities. Finally, by partnering with a collection agency, you can expand your business opportunities. When you’re not bogged down by debt collection efforts, you can focus on growing your business and taking advantage of emerging opportunities and making new money. (That’s a lot more energizing!)
As you can see, partnering with a great collection agency is a smart strategy when inflation is high, even more than during typical economic cycles. By recovering overdue accounts more efficiently and effectively, you can improve cash flow, reduce risk—and position your business for growth.
