Debt Collection For Print Marketing
Companies that exist in the print marketing industry are facing many challenges as advertising dollars have consistently shifted towards digital platforms over the last two decades. Despite this shift, however, there is still a considerable amount of money to be made in print advertising. In order to survive it is imperative that print marketing companies secure their revenue. Failure to secure revenue will ultimately lead to the closing of even the most successful media companies that are involved in print advertising. There are 3 key reasons these companies must maintain clean balance sheets and collect the revenue that they generate.
- Expensive Materials
The printing industry is extremely costly to maintain with many costs involved. Materials, rent, electricity, and distribution bills are part and parcel of the business. The collection of account receivables is essential since the funds can be used in the settling of expenses. With the fluidity of technology, printing industries have to be up to date with the best printing materials. New printers that offer the best-printed materials need to be purchased. As much as printers cost quite some money, ink prices are exorbitant. The reason why the prices for ink are high is that printers are cheap and sold in abundance. Therefore there has to be a factor that separates the good printing companies from the bad which is the quality of ink. In addition to the expensive ink quality printing papers are also costly. Distribution is necessary once printing takes place. The distribution process itself is expensive with the costs of maintaining fleets of vehicles or the costs associated with outsourcing this process.
- External Pressure
Back in the days when printed materials were accessible, the printing runs were longer and with high volumes to match. The business today however has low gross and profit margins. The traditional media has lost favor among people. Electronic media and the internet is preferred. Printing media is losing its touch because of the length of time it takes to disseminate information. It takes a lot of time to print the material while digital methods facilitate the publishing of information online within mere seconds. With low sales, printing companies lack money to run the business, risking the company’s bankruptcy and closure. Accrued amount receivables are a poor financial strategy, and with the prevalence of electronic and internet media, the printing business will be out of business. Therefore printing companies must collect invoices to acquire funding resources to keep the business running.
The printing industry is over-flooded with many parties trying to grab a piece of an ever-shrinking pie. The industry is faced with a big stumbling block because the use of printing material is reducing at high rates since electronic media is preferred. With minimal businesses, the printing industry operates on survival for the fittest mode. The printing company at the top of the genre will receive clients and the highest number of sales. To merge the gap between competitors, companies need to offer incentives to their clients. The best way companies can provide incentives is by offering credit facilities to clients. With shorter print runs and tight deadlines to match, printing companies offer to do the job without a payment upfront with the promise of paying up within 30 days. However, many clients default the terms of payment and go for other printing companies that do not carry out credit checks. Credit checks reflect on a client’s credit history. If these random checks are not made before sealing a deal, printing companies are bound to have account receivables whose collection is essential for running the business.
Companies with account receivables need to be aggressive in collecting all outstanding debts by involving debt collection agencies. Debt collection agencies are competent because:
Advantages of Using Collection Agencies
- Involving collection agencies is a stern measure that reflects on the magnitude of the issues. Debtors will therefore comply and pay faster when confronted since they fear their projection of the debt in their credit history.
- Debt collection agencies have the power to take matters into litigation if necessary and use attorneys who assist in debt extraction.
- The debt collection process is professional and client retention is possible if there are no ill intentions that remain after the collection.
- These agencies have the resources, finances, and workforce to get the job done Therefore involving them is cost-effective.
- Using them eliminates the legal risks involved in collecting debts on your own. Debt collection agencies have a vast knowledge of debt collection laws. Strict measures are therefore put in place to ensure the collection is legal.
- Debt collection agencies document the proceeding of the process in case lawsuits are filed against you in the future. The documents are also useful in case you plan on suing the client.
Printing companies are slowly tumbling in the economy because traditional sources of information are being abandoned for digital methods. They should, therefore, impose strict measures that protect them from incurring losses from defaulting clients. Accounting receivables should be collected without delay because it cripples the running of the business. Expenses such as materials, electricity bills, rent, labor, and distribution costs cannot be catered for with enough funding. In order to avoid getting account receivables printing companies should ensure that credit checks are carried out to determine the eligibility of receiving credit before offering credit facilities. If clients fail to pay on time debt collection agencies can be involved in the recovery.