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Client

A prominent West Coast commercial and residential waste management and recycling company.

Challenge

The company had been employing a conventional agency at a rate of 40%. But because of the high fee, they’d wait until commercial accounts were at least 150 days overdue before submitting them. And they didn’t have the personnel to make outbound calls to residential debtors, so they waited 60 days after discontinuing service before submitting those. The time that elapsed ensured the percentage agency would garner poor results on both types of accounts.

The company was getting a recovery ratio of less than 17% on commercial and 10% on residential accounts. They were paying more in collection fees than they were actually recovering.

Solution

TekCollect instituted a preventive maintenance program with a low fixed fee that makes it economical to submit commercial accounts at 90 days, immediately ensuring better recovery results.

Additionally, we assumed a first party role to provide outbound calls to the company’s residential debtors. The company now places with us a week prior to discontinuing service. We have the opportunity to inform clients of the payment deadline, take payments over the phone, and ensure their service can continue without interruption. If there are any disputes, we transfer calls to the company’s internal billing department. This has not only eliminated internal costs, but also provided the accounts receivable support the company desperately needed. And, it’s preserved an overwhelming percentage of client relationships.

Since we first partnered with the company in 2002, we’ve been able to cure 72% of their accounts. The company has gone from placing approximately 3,000 accounts per year to less than 1,000. And we’re recovering 35% of all accounts placed at a cost to collect of just 6%.

© 2009 TekCollect Corporation