Collection Agencies Working For Credit Departments

By Dean Kaplan+

It is very common for Credit Departments to hire collection agencies to assist them in their debt collection efforts. Often, if a credit department’s own collection efforts are unsuccessful, this can be a positive next step. This is the first article in a four part series of articles which will look at the credit department in the company setting and its need to view the other internal departments it deals with as internal customers. In addition, the articles will explore the role of collection agencies and how their dealings with clients’ debtors can affect internal customer satisfaction.

“Customer satisfaction” continues to be a buzz word in business today. It is important to be aware that departments within companies have internal as well as external customers. This is especially true for the credit department. Agencies when acting as debt collectors for credit departments must also be well aware of these internal and external customers. How collection agencies deal with debtors (external customers of the clients) can affect many different internal customers at their clients’ companies.

By leyla.a (no real name given) http://www.flickr.com/photos/leyla_arsan/4486356124/

Collection agencies play a crucial role in the day-to-day business of many types of companies.

Customers are satisfied when their needs and expectations are understood and met or even exceeded. In addition, in the business setting, this needs to happen at the same time that resources are optimally utilized. In other words, the company isn’t losing its shirt in its effort to satisfy its customers. Many companies have developed strategies and processes to satisfy external customers. However, fewer companies have put the same effort into maximizing internal customer satisfaction. One interesting thing to note is that when internal customer satisfaction is high, generally the operation runs efficiently and productivity and morale are high. These three things in combination are known to positively affect a company’s bottom line.

When a company is looking for overall customer satisfaction, this requires that all employees work together and assist each other to maximize external customer satisfaction. Since the only way for all employees to work together well, is for internal customer satisfaction to be high as well, it becomes clear that overall customer satisfaction requires both internal and external customer satisfaction. The two go hand in hand. When we add the collection agency into this picture, the agency must also be promoting customer satisfaction with debtors, as well as providing the credit department with all the information needed to communicate with its internal customers throughout the company.

The wide range of job duties relating to the credit, collection and accounts receivable areas require the credit department to frequently interact with both external and internal customers. For this reason, it is extremely important for the credit department to fully understand the roles of other departments throughout the company with external customers and with each other as it relates to external customers. For example, if the credit department decides to put a credit stop on a customer who isn’t paying its debt, this will affect the shipping department because any further shipments will be stopped until the payments begin again. In addition, the sales department needs to be told, because it makes no sense to accept new orders, if no shipments are going out. If you add the collection agency into this scenario, the debt collector needs to be informed because he or she can then communicate with the debtor, and use the credit stop as pressure to motivate payments to be made. When all the customers, internal and external, are working together, the company operates like a well-oiled machine. When the pieces aren’t working together, the whole thing can come to a screeching halt and frustration is likely to run supreme. Clearly, overall customer satisfaction is a worthy and necessary goal for any company to strive for.

If you would like to continue to Article two in this four part series, click here Collection Agencies And Credit Department Internal Customers. In this article, we will learn how to identify all the internal customers of the credit department, as well as how agencies can help credit departments maximize customer satisfaction with its internal customers.

The Kaplan Group is a boutique collection agency specializing in large (over $10,000) debt collections due from businesses. Founded in 1991, the company has a stellar reputation (A+ rating with the Better Business Bureau) and is recognized as one of the leading collection agencies for results on large and complex matters.

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