You want an agency that will represent your organization in a responsible and professional manner, and provides a satisfactory rate of recovery while maintaining your public image. According to the American Collectors Association (ACA), this decision involves more than just giving your business to the lowest bidder.

• Find out what capabilities an agency has. Some capabilities may include skip tracing and forwarding abilities, electronic data transferring, billing and other additional services.
  
  
• Discuss recovery percentages and rates. Remember, the rate of commission is less important than the agency's percentage of return on accounts you place with an agency.
  
  
• Make sure the collection service has the skills and market knowledge needed to successfully collect on your particular type of accounts. For example, collectors working in medical collections must be familiar with medical terminology and insurance requirements.
  
  
• Investigate the procedures an agency uses to collect, and become familiar with the agency's policies and standards. A visit to the office can often be helpful in this area.
  
  
• Determine if the agency holds membership in state or national trade associations such as ACA. Also make sure the agency complies with all state licensing and bonding laws, if applicable.
  
  
• Ask if employees receive training and certification. Although certification is voluntary, it indicates that the agency is responsible and recognizes the value of professional, competent employees.
  
  
• Ask for references. Try to contact at least two other credit grantors in your industry that are currently using the agency's services.
  
  
• Determine if the agency carries Errors and Omissions Liability (E&O) insurance. This insurance often extends coverage to the credit grantor as well, because a creditor client may face litigation as a result of alleged violations by their agency.

By evaluating your company's needs, as well as the capabilities of the collection services available, you can maximize your accounts receivable income and ensure that your customers are handled properly.

This careful selection of a third-party collection agency strengthens your bottom line and helps you retain customers, leading to a more profitable business and financial well-being.

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