I have read numerous blogs about collection agencies looking to cut costs in this difficult economy. The 3 largest costs that were debated were: worker expense, mailing costs and telecomms cost.

Reducing headcount is only a good course if you have ineffective employees. Every company should do continual reviews and eliminate staff when they are not performing to expectancies. The best run collection corporations steadily assess their operations and provide training to new and existing staff to make them better. By instilling high expectations and providing your employees the proper training to perform at a high level, you will make their work better, clients will be more happy and collections revenue per employee will improve.

Mailing programs are reasonably consistent in price and services. Limiting mail returns and bulk mailing are a couple of the common money savers. The biggest savings in mail costs can be derived from cutting down on the number of pieces sent. There are numerous scoring firms that will offer a program to ascertain which pieces are not very likely to offer an economic return.

Good collection agency software can also provide some basic criteria to get rid of those mail pieces that don’t meet the minimum criteria to mail. As an example, any account that has got a balance less the $25 and is greater than 180 days old is not likely to offer a reasonable return on a letter series at 55 cents a letter.

FDCPA demands that a preliminary letter be sent. Once the letter is sent a message regularly is enough to get some yield on low balances. Sending statements by email is also a money saver, but handling that process is best left to an external service which will assure compliance.

Telecomms costs are one of the best areas to figure out services that are overpriced, underused, or to establish that new services are available that are better, quicker, and less expensive. Many companies are migrating to VOIP services for the telephone and messaging systems. Hosted dialers provide all the features a collection company wants including messaging, text to speech, interactive voice response (IVR), automatic call distribution (ACD), incoming priority routing, and call recording.

As corporations grow, telecoms services frequently go years without any substantial review. An inclusive review with an expert can regularly find thousands of dollars being spent on services that are not being used. Some services will do a review and they will charge a percentage of the savings that you’re going to realize in the following 6 months or year. They can simply identify where you are able to save some cash with no effect on service.

Rodney MacKenzie is VP of Sales & Marketing for CollectTech Solutions. Their flagship debt collection agency software is Wincollect.

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