Profit Fix #5: Got Accounts On Credit Hold? Collection Agency Chasing Down Unpaid Bills?

How many invoices are being sent to collections by mistake?

How many of those result in a credit hold?

What if I told you that 3 out of 4 of those cases could easily be avoided?

This article expands on Profit Fix #4 about slow invoices and is another game-changer for our partners when it comes to collections, client relations, and cash flow.

Here’s an unfortunately common scenario:

*Phone rings*

> CS Agent: “Hi, this is George from BestTechService, how can I help you?”

> Client: “Hi George, this is Matt from NiceFoodJoint. I need a technician to come ASAP to check our combi oven please.”

** CS agent checks CRM **

> CS Agent: “Hmmm, sorry, Matt, but I see here that you’re currently on credit hold.”

> Client: “I’m sorry? Why would we be on credit hold for?”

> CS Agent: “The invoice, No. 123653 from 40 days ago, is still unpaid sir.”

** Matt checks his bills **

> Client: “Hmm, George... We didn’t even receive that invoice. It’s not on file.”

> CS Agent: “Oh, again... I'm sorry for the confusion, then. But still, I’ll need to have this resolved by collections and approved by the district manager.”

> Client: “Wow… Really? Ok, you guys do you, but my combi oven can’t wait until then, you know? I’ll call someone else!”

This may sound like an outlier scenario, but if you’re processing hundreds, or even thousands, of work orders a day, you know that it’s more common than we’d like it to be. And this is costing mid-market companies a small fortune!

Not only was the missed work order for a couple of grand and is now in a competitor’s pocket, but now that invoice will go to a third-party collection agency that will take 25 percent as their cut, make unfriendly calls, and ruin relationships with legal threats.

And now, the district manager will have to try to win the account back—that is, if they even get over the embarrassment and pain of doing so.

A relationship that took months or years to build, can be trashed in minutes...

… And statistics say that an account on credit hold is probably not coming back anyway.

Boy... What a mess!

So why does this even happen? And, most importantly, how can it be solved?

We’ve seen it happen mainly because of relying too much on automation, without enough human supervision.

And this is how it looks:

Most of the invoicing is automatic these days, which is good. But a big disconnect might happen for something as simple as:

- There was a change in the accounts payable email address, on the client-side.

- The vendor didn’t update the CRM with the proper email where to send the invoices.

- An invoice was sent to this client.

- The CRM automatically marked an invoice as “done” even though the client never got it.

- No one checked that the client did get it.

- 40 days later the CRM automatically marked the account as “credit hold”.

Technology and automation are AMAZING, except for when they're not, right?

Now to the good part: how can this be solved?

At Origo, we’ve deployed a “revenue recovery” remote team for one of our leading partners and reduced the collections being handled by a third party by 75 percent!

Think about it, three out of every four invoices that were previously going to an external collection agency are now being handled internally—by their remote team—bringing forward multiple six figures in cash flow for them every month.

And the other benefits were HUGE.

Not only did we collect MORE—because we’re picking up issues earlier when relationships are still on the sweet side. So, there are no threats made, and no middle fingers being thrown in the air. But also, there’s no “collection commission” either! Because it’s not a collection service. It’s now part of their remote team’s day-to-day operations.

Our partners now have a dedicated remote team in place, with a process that actively watches their accounts, the status of payments, and that proactively reaches out to their clients, sorts due invoices, and solves disputes.

And client relationships are not harmed. If anything it’s the opposite! Clients are taken better care of and feel significant that there’s someone that follows up on things for them.

And when we take care of all the standard invoicing for our clients:

- They have fewer disputes and fewer third-party collections

- They have better cash flow

- Their in-house billing team is massively FREED UP to take care of the more custom and complex invoices for key accounts

- Their billing managers sleep better

- Their executives smile more 🙂

As you can see, it’s a complete paradigm shift and one that we’re thrilled to be bringing to mid-market companies.

We’re already helping industry leaders adopt this model, and would love for you to be next.

So, we’d like to extend you an invitation...

After processing around ONE MILLION work orders over the last three years, we have enough DATA to assess where a business could be leaking profits in 30 minutes or less.

We’d like you to take a free run through our “Profit Score Quiz” to find out how much money you could be saving, and how much your cash flow would improve by keeping most of your collections in-house, instead of with a third party.

And again, this is just one of nine other profit leaks that we’re plugging for our partners. The last time we ran this quiz with a company out of New York, we uncovered six figures leaking in profits for them. Per month!

Take the Profit Score Quiz here

And we’re not guessing here. This is based on a million-plus data points. We could be asking for a decent fee just to let executives take this “quiz" but I want you to take it for free.

Just comment below or send us a message if you’re interested, and we’ll make it happen. We’re looking forward to chatting with with leaders like yourself!

Yassin Shaar

Chief Growth Officer





Hall of O-someness


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