Point Credit Solutions - Blog , UncategorizedPoint Credit Solutions - Blog , Uncategorizedhttps://www.pointcreditsolutions.com/blogs/UncategorizedFri, 24 Apr 2026 20:12:41 -0700http://zoho.com/sites/<![CDATA[Collection Industry Stats ]]>https://www.pointcreditsolutions.com/blogs/post/collection-industry-stats

Collection Industry Stats

• More than 6,500 collection agencies and 1,600 credit reporting agencies service an estimated $135 billion in delinquent consumer debt placed for collection in 2000. This is nearly double the $73 billion placed for collection in 1990. (Source: The Kaulkin Report, August 2001)

• The average amount of new business placed for collections in 2002 was $136,303,260 and the average recovery rate was 18-percent. (Source: ACA International’s 2003 Benchmarking/Cost of Operations Survey)


• The debt collection market generates approximately $13 billion in revenues for United States companies. (Source: The Kaulkin Report, August 2001)

• The collection industry saves the average American family of four $331 a year. This represents money they would have spent in increased cost of goods and services, if businesses raised their prices to cover their losses to bad debt instead of recovering the revenue through a collection agency. (Source: ACA International, May 2004)

• The healthcare industry is the largest source of collection agency business, with 76% of agencies participating in the collection of healthcare accounts. (Source: ACA International’s 2002 Compensation & Collection Agency Operations Study)


• Collection agencies are vital to the financial stability of hospitals across the U.S. According to Hospital Accounts Receivable Analysis (HARA), hospitals nationwide wrote off an average 5.1 percent of their revenue to bad debt and charity care from 2002 to 2003. This loss is greater than the average operating margin for hospitals industry-wide (4.5 percent), according to the American Hospital Association. And it is over seven times greater than the razor-thin 0.7 percent average margin for members of the National Association of Public Hospitals and Health Systems (NAPH), who serve a disproportionate number of low-income and uninsured patients.

• The Bureau of Labor Statistics estimates employment in the collection industry will increase 21-35 percent between 2000 and 2010. (Source: Bureau of Labor Statistics, Occupational Outlook Handbook)


• The Fair Debt Collection Practices Act (FDCPA), the federal law regulating third-party collection agencies, which was enacted in 1977 with the support of ACA, is designed to help protect consumers from unfair and abusive collection practices. (Source: A Guide to the Fair Debt Collection Practices Act)


• The average number of phone calls a typical collector attempts per hour is 20. A typical collector will reach six debtors in an hour with at least two promises. (Source: ACA International’s 2002 Compensation & Collection Agency Operations Study)


• ACA member agencies make nearly 87 million consumer contacts a month, which is over 1 billion contacts per year. (Source: an ACA International study conducted by Ernst & Young, August 1999.)


• The average annual turnover rate for collectors was less than 10-percent in 2001. (Source: ACA International’s 2002 Compensation & Collection Agency Operations Study)

• The average collection agency employed 19 collectors and 10 other full-time staff members in 2003. (Source: ACA International’s 2004 Benchmarking/Cost of Operations Survey)


• Historically, firms employ more female collectors than they do male collectors, although the gap is narrowing. The proportion of male to female was 1 to 3 in 1999 and it is currently 2 to 3. (Source: ACA International’s 2002 Compensation & Collection Agency Operations Study)


• 60% of collection agencies employ one or more bilingual collectors. The most common language other than English is Spanish, followed by French and German. (Source: ACA International’s 2002 Compensation & Collection Agency Operations Study)


• Employee compensation accounts for nearly half (46.68%) of the total expenses at the average collection agency. (Source: ACA International’s 2004 Benchmarking/Cost of Operations Survey)


• The average annual base salary for a collector is $22,487 with an average commission rate of 12-percent – totaling $31,812. (Source: ACA International’s 2002 Compensation & Collection Agency Operations Study)


ACA International has complied this information from a variety of industry sources in response to frequent questions regarding the credit and collection industry. All sources are cited and every effort has been made to assure that the information is correct. For more information, contact ACA’s public relations specialist at (952) 928-8000 ext. 714 or pr@acainternational.org

THIS INFORMATION IS NOT INTENDED AS LEGAL ADVICE AND MAY NOT BE USED AS LEGAL ADVICE. IT SHOULD NOT BE USED TO REPLACE THE ADVICE OF YOUR OWN LEGAL COUNSEL. ANY INFORMATION CONTAINED IN THIS MATERIAL IS BASED ON CURRENT RESEARCH INTO THE ISSUES AND ON THE SPECIFIC FACTS INVOLVED HEREIN.

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]]>Tue, 29 Jun 2021 14:22:20 -0500<![CDATA[Problems in your client's geographical area can be a sign of potential credit problems!]]>https://www.pointcreditsolutions.com/blogs/post/problems-in-your-client-s-geographical-area-can-be-a-sign-of-potential-credit-problems

Problems in your client's geographical area can be a sign of potential credit problems!


Focusing on trends in specific geographic areas can save your business an abundant amount of both time and money.


Say you have several clients in a region that is losing large amounts of their population due to failing industries. It may be time to rethink doing business there. This is often a sign that customers are going to become delinquent on their debts in the near future.

                

There will also be times when a geographical area is only facing temporary issues. These may include off-seasons, disasters or miscommunication. If the problem is temporary, it is crucial to communicate with your client or customer to discuss how to proceed and when payment can be expected. Off-seasons may result in lack of funds to repay debts owed when they are due.


Consider changing business terms only to work with that client when they are in season, ensuring they will be able to pay you on time.


Disasters such as floods, fires or tornadoes don't typically require termination in doing business with clients. However, the client may need extended payment terms. As always, keep in mind, most people want to pay their bills.


To make collecting past due debts as smooth as possible, early intervention is key. The likelihood of collecting decreases as time passes. When you can't collect what people owe you, business becomes much more complicated. Keep an eye out for trends in specific geographical regions to avoid unnecessary problems.

]]>Tue, 01 Dec 2020 23:31:49 -0500<![CDATA[Partial Payments: What To Know!]]>https://www.pointcreditsolutions.com/blogs/post/partial-payments-what-to-know

Partial Payments: What To Know!

Partial payments usually lead to bigger problems. It is important to have an internal system such as a CRM to take note of partial or late payments. If your customer can't afford to pay the agreed amount this month, they are likely not to be able to pay the following month either. The longer this goes on, the farther behind they get on paying you for the product or service you provided.

 

Prior to accepting a partial payment, find out the reason. Is it due to financial troubles? If the customer is awaiting a pay check before being able to pay the full amount, consider changing the due date to accommodate their financial situation. Some customers may have the funds however they are not so great at budgeting. If this is the case, consider setting them up with weekly or bi-weekly payment dates.


While a partial payment is better than no payment at all, it is crucial to have the customer sign an agreement. This will ensure the customer understands that you expect the remainder of the payment by a certain date. Communicating frequently with the customer will keep them engaged and understand that they are responsible for the remainder of the payment.

At Point Credit Solutions, we understand that debtors may need help with budgeting or are awaiting a paycheck. We offer online payment options to make it as easy as possible that way debtors can pay from anywhere, at any time.

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]]>Sun, 01 Nov 2020 23:19:27 -0500<![CDATA[Skip Tracing Tools and Techniques]]>https://www.pointcreditsolutions.com/blogs/post/skip-tracing-tools-and-techniques

Skip Tracing Tools and Techniques

Skip tracing is a key element of debt collections and most debt collectors will participate in this activity in their daily operations. Skip tracing is the practice of locating individuals. This practice takes place in the collection industry when the contact information on an account is no longer valid.


Since without correct contact information the account is not collectable, it is necessary to skip trace, or locate the responsible party in order to initiate the collection process and resolve the delinquency. Skip tracing is a skill that improves with practice.


Skip tracing uses the information provided with the application for credit. The information used are the borrower’s name, address, telephone number, place of employment, and any references that were provided with the application for credit. With that information, it is possible to search for new addresses, new telephone numbers, and new places of employment. Furthermore, the names, addresses, and telephone numbers of family members, friends, acquaintances, and possible neighbors, are also useful to verify the correct contact information of the responsible party. Inherent to achieving success with skip tracing is the ability to make connections in existing data, most of which is publicly available and free to use. The most commonly used tools for skip tracing are phone directories. It is also possible to access reverse directory information via directory assistance. This is the practice of obtaining a name and address associated with a telephone number. There is so much information that is valuable when skip tracing. Social media, marriage licenses, business licenses, permits, certifications, property records, genealogy records, are just a few of the many available resources one can use to track down a person who has skipped town, which is interestingly the origin of the term used in collections today.


In the past, it was possible to contact one of the borrowers other creditors, in an effort to obtain correct contact information. Collectors would have a rolodex containing contacts at many of the major creditors, usually other collectors in the industry, and sharing of contact information was an acceptable practice in debt collections. However, with the advent of the Gramm Leach Bliley act, this particular activity is no longer an acceptable practice.


With the advent of the Internet, skip tracing is much easier than it used to be. There is a huge amount of information available via online resources. Phone directories are now available online, and include the capability for reverse directory searches. Online resources include skip tracing web sites, which provide links to public record databases that may have useful information or other leads when attempting to locate an individual.


Many commercial skip tracing tools, such as Accurint by Lexis-Nexis, make use of the internet for access. Accurint is one of the premier commercial skip tracing tools for commercial use. With Accurint, it is possible to search for historical and current data on individuals using any manner of demographic information from addresses to social security numbers, depending on the level of access. Accurint will also provide family member information. With Accurint, it is possible to search by address, and obtain names and telephone numbers of the neighboring residences of that address, useful when attempting to verify correct information.


The major credit reporting bureaus also have online access for report ordering. Social networking sites are also becoming a resource, providing another avenue of investigation when attempting to locate contact information for an individual. Due to the Internet, cost for skip tracing has lowered due to many state, county, and city government agencies providing public access to information via the internet at no cost, whereas cost is involved to request a hard copy of the same information via mail.


Article originally published on JobMonkey.com

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]]>Tue, 27 Oct 2020 08:42:39 -0500<![CDATA[Change in Client Payment Patterns Can Be A Warning Sign of Potential Credit Problems!]]>https://www.pointcreditsolutions.com/blogs/post/change-in-client-payment-patterns-can-be-a-warning-sign-of-potential-credit-problems

Change in Client Payment Patterns Can Be A Warning Sign of Potential Credit Problems!


Patterns can help point out why or when someone will be making their next step. When evaluating a delinquent customer, take note on how often they pay, if any payment plan was put in effect, if they pay with cash or card and how much they pay.


At Point Credit Solutions, we have found it very beneficial to track payment patterns using our customized CRM system. When we have a debtor who is on a payment plan with a due date coming up, we simply send a reminder via email. This keeps the debtor informed and engaged in paying off their debt.


Or better yet, schedule automatic weekly or monthly payment on a credit or debit card to create consistency, and predictability.

We also find great success in tracking the number of days a delinquent account takes to be paid off. With past due accounts, the clock is always ticking. Once an account reaches 60 days late, internal collection efforts lose over 53% of their effectiveness. At 60-90 days, accounts become virtually ineffective to collect. Age is the largest deteriorating factor in the collect ability of delinquent accounts. By contacting debtors early, they respond more positively, and that increases the likelihood of a continued business relationship. We recommend referring accounts as early as possible and with our low costs and high recovery ratios, it is possible!


Bella Debo

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]]>Mon, 26 Oct 2020 20:43:51 -0500<![CDATA[Why Clients Asking For Clarification, Proof of Service, or Delivery Can Be A Warning Sign of Credit Problems!]]>https://www.pointcreditsolutions.com/blogs/post/why-clients-asking-for-clarification-proof-of-service-or-delivery-can-be-a-warning-sign-of-credit-pr

Why Clients Asking For Clarification, Proof of Service, or Delivery Can Be A Warning Sign of Credit Problems!

Many clients are easy going and a joy to work with. However, there will be times when you need to keep your guard up. If a client is repeatedly asking for clarification, proof of service, or delivery that is usually...not a great sign.

 

Keeping a clear record of the services and/or products your business preform will be very beneficial in situations like these. Implementing contracts to be signed by the customer is a great way to ensure payments will be made. Terms in the contract should be clearly defined, alongside a late fee agreement so that there are no questions as to what is expected of the client.



When clients are asking for 'proof of delivery' or clarification it is crucial to stand your ground. To avoid getting scammed, have you delivery drivers/courier service get a signature upon delivery. This will act as a receipt to confirm the object is in their possession.

 

Overall, communication and record keeping is key. Your business and the service it preforms deserve respect. If a client is causing issue after issue, take matters into your own hands and terminates doing business with them.


Bella Debo



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]]>Thu, 22 Oct 2020 22:49:41 -0500<![CDATA[A Frequently Used Industry Term: Accounts Receivable]]>https://www.pointcreditsolutions.com/blogs/post/a-frequently-used-industry-term-accounts-receivable

A Frequently Used Industry Term: Accounts Receivable

Many of you know what accounts receivable means however, many of you also don't. Weather you are a business owner, a teacher, an office manager, or even a stay at home parent, this term is important to know. It is the money owed to a company by its debtors. Generally it is in the form of an invoice and presented to the consumer at the time a payment is past due. Receivables should always be recorded at the time the good or service is completed, but not yet paid for.

    

Failure to pay within an agreed time frame leads to the most accounts being sent to collections. When a business has many accounts receivables, hiring a professional agency is never a bad idea. At Point Credit Solutions, we specialize in collecting accounts receivables for any business, of any size.

    

How does Point Credit Solutions collect past due receivables?

We use techniques designed to educate as opposed to alienate. Our objective is to preserve the credit grantor's goodwill and relationship with the debtor.

    

What makes Point Credit Solutions accounts receivable collection process different from competitors?

Point Credit Solution's low fixed fee lets creditors refer accounts earlier, preventing the deterioration that occurs with age and increasing recovery results. 


Can Point Credit Solutions help my business recover slow-pay and delinquent accounts receivable?
Yes! And without alienating your customers! We offer the best of both worlds! Get paid, and keep your customers!
Click the "Get Started" button for a free accounts receivable analysis now!

Bella Debo
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]]>Tue, 20 Oct 2020 18:21:23 -0500<![CDATA[How to Calculate Days Sales Outstanding]]>https://www.pointcreditsolutions.com/blogs/post/how-to-calculate-days-sales-outstanding

How to Calculate Days Sales Outstanding

Days Sales Outstanding (DSO) is the average number of days that receivables remainoutstandingbefore they are collected. It is used to determine the effectiveness of a company's credit and collection efforts in allowing credit to customers, as well as its ability to collect from them.


To calculate your days sales outstanding, you’ll need to pull information from an aged accounts receivable report or a balance sheet. Once this information has been gathered, you’re ready to calculate your DSO.


1. Determine the period to cover

It’s up to you to determine the period you want to cover when calculating DSO. Smaller businesses may find it more useful to calculate DSO quarterly, although businesses that frequently sell on credit should do a DSO calculation monthly.


2. Calculate beginning accounts receivable total for the period

This information can be obtained from a balance sheet that is run as of the first date of the period you’ll be examining. For instance, if you wish to calculate DSO for the first quarter of 2020, you’d run a balance sheet as of Jan. 1, 2020, to locate your beginning accounts receivable balance.


3. Calculate ending accounts receivable total for the period

Obtaining your ending accounts receivable balance is done the same way, only this time you’ll run a balance sheet report as of March 31, 2020.


4. Determine average accounts receivable for the period

For this calculation, just take your beginning accounts receivable balance and your ending accounts receivable balance for the time frame you selected.

For example, if your Jan. 1, 2020, accounts receivable balance was $27,000 and your ending accounts receivable balance was $31,000, you can calculate your average balance like this:  ($27,000 + $31,000) ÷ 2 = $29,000

Now you know that $29,000 was your average accounts receivable balance for the first quarter.


5. Calculate total credit sales for the period

This calculation can get a bit tricky if you don’t keep track of cash sales separately. If you do, all you need to do is locate your total sales for the period. Be sure and subtract any returns or adjustments, and if you don’t track cash sales automatically, you’ll have to subtract those as well.

For example, if you had credit sales of $57,000 for the first quarter of 2020, with returns totaling $1,500, your total sales for the period would be $55,500.

6. Determine the number of days in the specified period

If you’re calculating DSO for the month, you use the number of days in the month. In our example, we’re calculating DSO for the quarter, so we’ll need to add together the number of days in each month.

  • January: 31 days
  • February: 29 days (leap year)
  • March: 31 days

So, the total days for the first quarter would be 91.


7. Calculate DSO

With all the information gathered, you’re now ready to calculate days sales outstanding using the DSO formula.

($29,000 average accounts receivable ÷ $55,500 credit sales) x 91 days = 48 days


You now know that it takes your business 48 days on average to collect payment on an invoice. But what do those results mean?

In general terms, a DSO of less than 45 is considered good, but this can vary between industries. For example, a manufacturer selling heavy equipment is more likely to have a higher DSO than a service business. If your DSO comes back fairly high, there are ways you can lower it.

See our article:  Five Ways to Get Paid Faster


           According to CFO.com, the median DSO is 38 days. This can vary by industry.


If your DSO is out of line request a Free Accounts Receivable Analysis! We have helps many businesses improve their cash flow!
 

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]]>Tue, 20 Oct 2020 00:01:06 -0500<![CDATA[Numerous Inquiries About One of Your Clients Can Be A Warning Sign of Potential Credit Problems!]]>https://www.pointcreditsolutions.com/blogs/post/numerous-inquiries-about-one-of-your-clients-can-be-a-warning-sign-of-potential-credit-problems

Numerous Inquiries About One of Your Clients Can Be A Warning Sign of Potential Credit Problems!

As a business, it is important to understand your clients. Weather it is a first timer - or a 'regular' one must do their research. To ensure your product and/or service will be paid for, first determine the customers ability and likelihood of settling a debt within agreed credit terms. 


If a client has a history of overdue debts, bankruptcies, disputes or longer repayment periods, these are a huge red flag and warning sign of potential credit problems. Disputes need to be dealt with right away, hear the client out but be sure to keep an eye out for foul play. If the client starts suddenly complaining about your services, find out if there is a real problem, because alternative motives may be in effect. More often than not, customers pick fights when they know they are in financial trouble, hoping to buy some time before paying you.

 

Be especially watchful and selective before extending credits to clients. If you have a client that repeatedly makes excuses and asks to extend payment deadlines, it is best to stop working with this client immediately. Remember, cash flow is king to any business and receiving on time payments is a crucial part to financial success.


Bella Debo

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]]>Fri, 16 Oct 2020 13:30:21 -0500<![CDATA[Most People Want to Pay Their Bills!]]>https://www.pointcreditsolutions.com/blogs/post/most-people-want-to-pay-their-bills

That's right...If you are a business trying to collect outstanding receivables, it might not feel like ANYONE wants to pay their bills! The reality is, most people want to pay you but sometimes there are circumstances that prevent them from doing that.


These circumstances usually fall into three categories. Something they can control, something you can control, or something no one can control.

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]]>Thu, 25 Jul 2019 10:38:48 -0500