Improving your credit and collection process is rarely a glamorous or fun job, but is still one of the most important things you can do to improve your bottom line. A robust and well tested credit policy and collection procedure can both minimize bad debt and help you collect more of what slips through the cracks. In order to help you minimize the time you spend on this endeavor, here are five things to avoid in any credit and collection process. 

Not Striking a Fine Balance Between Rules and Flexibility

As much as we think we can come up with a plan for every scenario, there will inevitably be a time where a customer does not fall into any of the situations you prepared for. If your credit and collection professionals are simply used to following a strict set of rules, they will not only be lost in this scenario but they will also never improve on the original system. Maybe something that you designed in theory does not work in the field. It is important that your employees follow guidelines, but are able to work with some reasonable amount of flexibility to adapt and improve. 

Outsourcing your problems too early 

While there are certainly times to outsource your collection process, developing an robust in-house collection process is important in collecting as much money as possible. For starters, if you outsource accounts that could have easily been collected with a simply email or letter, you are giving up a percentage of the amount received for no reason. Secondly, the key to any collection is starting early. If you are able to start the process sooner, there is a greater likelihood that either you or an outside agency will be able to collect the debt in the long run. 

Getting Stuck in Your Ways

Technology is advancing at a rate never before seen in history. There are countless new enterprise and consumer software platforms being released each year. While we are not recommending you try each one, we do recommend that you keep an open mind to new technologies that could help your business. Just because it is working for your company now, it does not mean it is the best option or will continue working in the future. 

Credit and Collections have never been and will never be one-size fits all. The needs of your business are unique and thus your credit and collection process should be as well, but avoiding these pitfalls will allow you to minimize the mistakes you make while trying to find the system that works best for you.