This is a great first question to ask yourself if you are embarking on the voyage of debt collection. Those who are successful in this industry have a passion and a knack for being creative and successful. In today’s economy, collecting debt can be a challenging business at best. You must be willing to work hard, find creative approaches for working with others and managing your own cash flow even when debtors don’t or can’t pay. So why are you starting a debt collection business? Most new debt collection businesses today are started by two different groups of people:
- People who have been in the collection industry their entire life are tired of working for someone else and want to try to make a go of starting their own business in that same industry. Generally these are the people that already have connections, know the tools and industry, and have an entrepreneurial spirit about them.
- People who are unemployed and have always wanted to start their own business. Generally these people are in need of education and tools to assist them in being successful.
Statistically, if your business can survive the first 2 years, the chances of it being a long term success for you are very high. Smaller debt collection businesses can be run from the comfort of your own home. If you plan to process high volumes of debt it is recommended that you open a physical office structure where you can manage collection teams and staff. Regardless of the size of your business, there are a few things that can assist you in making your new collection business a success:
- Stay positive – this will be your best weapon of defense in the industry
- Stay on a consistent and normal schedule – too many new business owners make the mistake of trying to take unusual amounts of time of or work crazy hours. Success is more likely to occur by maintaining a steady and consistent work schedule
- Network with others – foster and develop communications with those in the industry. They will help educate you and refer business to you
- Get creative – just because everyone else is doing it one way doesn’t necessarily mean that other methods aren’t effective or successful. Remember this is your business and it needs your creativity and flare to make it successful.
- Get out of the house – if you decide to open your debt collection business in your home, make sure you take time to leave the house and stretch your legs. Many times, these breaks can be your best source of inspiration and sanity.