What Are All The Commercial Collection Accounts? Have Creditors Tightened Up Too Much?

Most people who are in the industry realize that it seems that in recent years collection agencies have started to greatly increase their number of accounts.  Many people as well as small business owners worry that the increase in commercial collection accounts is due to creditors tightening up and while that may be true to some extent that is not the only issue.  Part of the increase in collection law firms is simply that creditors are discovering new ways to collect on the money they are owed and in today’s economy, they want to be sure they have all the money that they deserve. 

Turning To Agencies

If you take a close look at the trends, you will notice that in the past when there seemed to be fewer collections, that was because most companies would take care of them themselves.  This means that they would designate someone, or a department, to take care of collecting on the debts.  In recent years, however, these companies have increasingly realized that they simply aren’t prepared to do this.  Because of that, they are turning to collection agencies to do the job for them.  This means that it is not necessarily an increase in collection of debts, simply an increase in amount of accounts with commercial collectors. 

Collecting More

With an increase in the use of collection agencies and therefore commercial collection accounts, more companies are able to collect on their debts.  This does not mean that they are getting “tighter” with the money.  Instead it means that they are finding more effective means to receive their money.  The increase in collection is more or less due to the more effective strategies used by these collection agencies as opposed to individual companies themselves.  Because of the success of these agencies, creating a commercial collection account may seem like the only reasonable option for a given company.