To make this concise and to the point, I'm in my mid-late 20s and I have owned a collection agency since 2011. It took me a long time to build what I have but now it runs pretty smoothly. If we follow the same formula, we get the same results but I'm growing discontent because I want to grow but our business model keeps us steadily at $400k/yr or so.
That $400k is enough to employ a handful of people and operate but doesn't leave a whole lot of room for growth. From what I've seen, the non-compliant agencies are generally the agencies that grow quick and easily. The catch (besides being immoral and even illegal) is that these non-complaint agencies need to make a lot of money and save a lot of money for when the fines and lawsuits catch up with them. I hate that it works this way but a lot of the larger agencies in the US goto to where they are today by breaking the rules until they were too large to fail and then paying off fines and lawsuit settlements once they're established. It really is hard to grow doing things the right way, but its the only way I'm willing to do things. I may not be rich but I make a comfortable enough living. A lot of months, employees here make more than I do and I'm ok with that, but I want to grow.
We have been working short term loans, credit cards, bounced checks and overdrawn bank accounts for the most part. Sometimes we buy the debt and sometimes we work it on contingency for clients.
More and more I've been seeing that businesses are offering some form of credit whether its a credit card of sorts or the ability to have a 'house account'. Basically, a lot of businesses have money due to them and they don't have any collection model in place. They tend to write this off as losses but it doesn't have to be.
The reason that credit unions or doctors may not collect on debts in-house is because it's risky if you don't know what you're doing. Collecting on debt without being trained or licensed is a lawsuit waiting to happen and a lot of credit issuing companies let unpaid bills add up.
A friend of a friend of mine is a chiropractor with their own practice who one time asked me to work a few accounts for them and we did. Every single account he placed with us had paid. Now, that's unusual but for years they would just drop clients who fell behind on bills and it was a good amount of revenue they were entirely neglecting.
This is the case with a lot of things- cities with unpaid parking tickets, bail bondsmen, contractors, web developers, landlords etc. If money is owed to a business, we can collect it.
I get why people are hesitant to hire a collection agency, they may be worried that it'll tarnish the business' names or maybe they don't understand how they work. What I want to do for my business is find a new niche. Maybe something like funeral homes?
I am pretty sure that I can market our services considering that we are strictly commission based with no cost to the business whatsoever. They send over a spreadsheet and we wire them money a few times a month with reports. It's really a win-win situation. I even collect for my accountant's firm, there's not much we can't do.
Now this is why I'm here. I'm looking for ideas of what types of businesses I can target with proposals. I'm looking for strange niches that one may not typically associate with overdue accounts or businesses that haven't ever considered using a collection agency. I would love to work on transitioning out of loans and into small business or a niche market so that I can build an empire around something specific instead of being one of the generic agencies doing the same thing.
What are some businesses that consumers or other businesses may owe money to? If you were in my shoes, what types of businesses might you seek out that would benefit from liquidating on overdue receivables?
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