Question:
I am looking for any information pertaining to measuring the performance
of third party bill collection agencies. One example is ‘recovery rate’
which measures the number of accounts the collection agency is
successful in collecting the outstanding debt.
I would appreciate it if anyone could provide any other key components
which should be measured to assess the performance of a collection
agency.
Answer:
Number of accounts is only a weak indicator of what is _really_ desired -
present value total collections.
[Lots of piddling accounts are meaningless, but 'look good'.]
Unfortunately, this is not completely measurable until after the project is closed.
Still, you could easily track it in a spreadsheet, just discount each receipt
actually received back to the start date. Track those summed values and you will
know when further work seems fruitless / inadvisable.
Another issue is how soon payment is received. Terms might be arranged for
payment over time, but this lessens the value to the first party. (It also has
problems of "will they actually complete payments".)
Another very similar aspect of time is how long until they start delivering funds,
as presumably that is the client need.
