Making Sure Your Biz Gets Paid

There are many reasons a company may not hit projected revenues. But one that often gets overlooked is the deadbeat client — a customer who skips out on the bill once products or services have been delivered. Many small business owners might not bother to go after a client who owes, say, $200, because the fees they would pay to a collection agency are too high. And the time it might take to collect could seriously affect their business. But there is a solution.

For less than $7, entrepreneurs and business owners can let deadbeat customers know they’re not taking “no” for an answer. Fidelity Information Corp., a full-service debt-collection agency launched www.olddebts.com in 1999 to allow business owners to collect from customers without paying contingency fees, which can amount to as much as 40% of the bill that is owed. “Going the traditional route on a $500 debt could cost you $250 if the collection agency is successful, or cost you nothing if they are unsuccessful. The alternative is that you can pay $20 or $30 and take a swing at it online yourself,” says Jeff Cronrod, CEO of Fidelity.

Fidelity’s Website is fully automated. The registration is free and once a customer is in the system, he or she can log on at any time and go after debtors. “It’s all done via computer, so the store is always open,” explains Cronrod, who says the collection software costs a little more than $1 million and took 18 months to design.

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