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Impact Data

Collection Agency Service Provider Non Profit Debt Buyer Credit Grantor Direct Marketer Submit Data File

Commercial Service Provider

serviceproviderOur client, a Fortune 100 service provider, billed its commercial customers monthly and waited for the payments to come in. Their DSO (days sales outstanding) topped 43 and the company had a goal of dropping that to 39. Not a large goal in terms of days, but considering that the commercial service provider was in a competitive market, customers who delayed payments rarely suffered repercussions beyond fees and surcharges.
The current operations environment consisted of a centralized receivables management area that was responsible for generating a notice at 15 days past due and then outsourcing 90% of delinquent accounts to contingency fee collection agencies at 30 days past due.There was no process used to identify accounts for specific treatment or placement. There was no risk score used on any account. Impact Data agreed to take one market consisting of just under 17,000 accounts and demonstrate the power of the Impact Data segmentation model.
The client provided a 15-month payment history in addition to the Zip code on 16,831 accounts.

Opportunities Identified

From this data we were able to observe a clear trend that the customers that had the highest propensity to perform had the highest variance between percentage of total accounts and percentage of total payments. Historically our analysis has shown that there is a close correlation to percentage of total accounts to percentage of total payments when the billed amount is the same across all segments. This is a clear indication that efforts were not being applied consistently.
The treatment strategy used on accounts identified in segment 1 was either not compelling to these customers or the contingency agencies were not able to manage workloads effectively or were using the wrong tools to attempt collection. The significant delta between this metric in segment 1 & 4 identified an annual opportunity of more than $44 million dollars in additional revenue on this one market. Our client operates in 51 markets, so the potential revenue increase is substantial.

Strategies Implemented

The client has made significant progress in execution of a strategy to offer an ACH and web-based payment solution and to adjust the verbiage of correspondence with discounts and other incentives to compel the customers in segments 1 & 4 to make payment on or before the due date. In addition, the Impact segment is used as a basis for their outsource collection placement strategy with specific work standards that must be maintained by their contingency vendors to reduce their DSO.
What can Impact Data do for your commercial service provider? We’ll prove our performance before we start with a sample of your data. Contact us to get started improving your collections, better targeting potential customers or reducing your DSO and adding to your bottom line. Or, register to receive our free eBook and learn more about the ways Impact Data can transform profitability through data intelligence.

Submit a sample data file to see how Impact Data can point you to the most profitable customers.