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Atradius Collections' Global Collections Review Reveals new Trend: Success Rate Valued Higher Than Pricing When Selecting a Debt Collections Agency
Amsterdam (ots/PRNewswire) - The latest "Global Collections Review" survey undertaken by leading worldwide B2B debt collections specialist Atradius Collections, shows a new trend amongst businesses when selecting a debt collections agency. Unlike in the past year, companies put more attention on the agencies' success rate, less the price.
This trend can be seen amongst many major European countries and reveals a mindshift in European businesses seeking support from external agencies when collecting outstanding debt. The success rate of a debt collections agency easily allows comparison between collection agencies' performance. The success rate* is defined as the value of collected payments of the total debt received and expressed as a percentage. The amount excludes insolvencies and withdrawals.
Raymond van der Loos, Managing Director of Atradius Collections explained: "Successful debt collections and ensuring solvency is fundamental to business. The study has made clear that the choice of a collection agency is made based on its quality, meaning its performance and ability to succeed in collecting, and not price."
He continued: "Here at Atradius Collections we are often asked about our success rates. Today we lead the market with an overall success rate of over 55% for national and international debt globally. The Global Collections Review again has shown that the ability of external debt collection agencies to deliver results is the key factor for businesses to employ a debt collections agency."
An additional significant finding from the study: companies are more willing to outsource their debt collections activities to external agencies in 2011 compared to previous years. During the crisis many businesses activated internal resources to collect outstanding debt. With the economy picking up and staff busy focusing on incoming business, collecting debt can again be seen as a task that is more frequently handed over to external agencies. The trend is significantly visible in Belgium, Italy, the Netherlands and Great Britain alike where over 10% increase was observed by the companies surveyed and is linked to the higher success rates of debt collection agencies and their expertise in the field.
Use of a Use of a Trend Collect Collect Trend Country DCA** 2011 DCA** 2010 Internally Internally 2011 2010 Belgium 33% 23% ^ 35% 58% v Denmark 24% 26% v 59% 79% v France 27% 32% v 49% 54% v Germany 32% 27% ^ 45% 63% v Great 43% 31% ^ 60% 66% v Britain Italy 31% 18% ^ 52% 69% v Netherlands 65% 54% ^ 31% 53% v Spain 20% 21% v 86% 60% ^ Sweden 41% 47% v 56% 54% ^
Source: Global Collections Review, 4th edition, May 2011
** DCA = Debt Collections Agency
In France a decrease in use of debt collections agency can be explained by the tendency to sell debt, as well as in Denmark where an overall decrease of outstanding commercial debt was observed.
Leader in usage of external debt collections agencies is the Netherlands where 65% of the surveyed businesses have used this service and is significantly higher than in countries, such as Spain which remains at a low 20%.
Broken down by sectors, companies operating in the financial services sector tend to use a debt collections agency more often while in the other sectors, such as manufacturing, wholesale and retail trade and distribution, services, companies have a preference towards collecting internally.
Overall, European attitudes relating to the selection of debt collection agencies were remarkably similar, which indicates that the requirements, expectations and high standards demanded of agencies are consistent factors irrespective of business type, size or location.
The survey for the Global Collections Review was conducted amongst almost 2000 businesses throughout nine countries in Europe, monitoring commercial debt collection trends and practices.
About the Global Collections Review
Atradius Collections conducts regular surveys of corporate collections behaviour across a range of countries. The findings are published in The Global Collections Review. This survey is conducted twice a year and is the forth time that the Global Collections Review has been published since its inception in 2009. In this survey almost 2,000 businesses located in nine countries across Europe which include Belgium, France, Great Britain, The Netherlands, Germany, Denmark, Sweden, Italy and Spain were surveyed. The full Global Collections Review can be downloaded from http://www.atradiuscollections.com .
About Atradius Collections
Atradius Collections, a business unit of Atradius Group, provides efficient, quick and flexible solution to recover domestic and international trade debts. With over 350 staff in 20 offices and an extensive network of collections specialists and lawyers worldwide, Atradius Collections serves more than 12,000 customers and handles, on average, 100,000 cases a year. Over 85 years of global credit management industry experience, uniquely positions Atradius Collections as a worldwide leader in business-to-business debt collections. Please visit http://www.atradiuscollections.com for more information.
* Debt collections success rate = the value of collected payments expressed as a percentage of the total debt received, excluding insolvencies and withdrawals.
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