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What You Need To Know About Your Outsource Billing Service

Todays Date: September 21, 2018

You may have hired an outsource billing service because you wanted to help your cash flow or improve your bottom line. An outsource billing service will do this for both companies and local governments, but it’s important to keep some facts in mind to make sure that they’re working for you in the best manner possible. Following are the things you most need to know about your outsource billing service.

Outsource billing services work for both private businesses and governments, and they often are a branch of third party collection agencies. If you want to hire an outsource billing service your first criteria should be whether or not they also do collections. This will ensure that if your accounts go into collections, the process will be seamless and cost-effective.

Think about it this way. If you’re working with a billing service but don’t have them doing your collections, when accounts start reaching the troubling milestone of 60 days past due, you’ll waste time looking for someone else to handle the collections process.

This may not seem like a big deal but it can mean the difference between getting a decent recovery and losing out. Taking out a step of the process (sending delinquent files to a new vendor) will make a big difference to your collection efforts in the long run.

Another thing to ask your outsource billing service is if they are getting volume discounts, and if so, if they’re passing the savings on to you. Many billing services do work for a high volume of companies, and therefore get bulk discounts on mailings, phone rates, etc. They should be passing these savings on to you. If they’re not, showing them you’re aware of this factor may prompt them to lower their rates.

There is no reason to pay more and to waste the resources of your accounting department or your sales department on billing or collections of any kind. Hire professionals, pay less for operational costs and free up your own staff to work on more productive, business-generating tasks. When you’re looking for an outsource billing service, ask them how many accounts they service in your industry. In this case, the more the better because of the cost savings.

Of course, if you hire an outsource billing service you will have to pay them a monthly fee, while many if not most collections agencies only charge a percentage of any money they recover. This is a serious benefit to the cash flow of any business or governmental department, so when you’re interviewing potential outsource billing services, ask if they are willing to take a monthly fee for the billing services, but a percentage of the take for collections services.

The final thing you need to know from your outsource billing service is whether or not they will allow you online access to your account. While you want to free up your time by letting them handle this function, it’s your business and you need to keep watch over this crucial part of it at all times. It may not have occurred to you to ask your outsource billing service for real-time access to your accounts, but this is absolutely something they should let you do.

David P. Montana has been a prominent industry expert, business consultant and writer in collection agency services for thirty years. He provides additional valuable tips and information about outsource billing.

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