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Like nearly all businesses COVID-19 has wreaked havoc with the recoveries and investigations industry in Australia.

In an interview with Alan Harries, CEO of both the Institute of Mercantile Agents (IMA) and Australian Collectors & Debt Buyers Association (ACDBA), Alan provided a unique perspective across collectors, field agents & investigators.

In past weeks Alan has been fielding calls from participants across all the industry sectors as to the impacts from the  pandemic and says that whilst the investigation sector still appears to be receiving instructions, the same cannot be said about repossessions, process serving and contingency collections with agencies across the country in those sectors reporting downturns in their workflow and restrictions on the services they can provide to clients.

Alan reports debt buyers are continuing with their portfolios of accounts to manage and although hardship management is always an essential element of their engagement with customers, in this period of growing unemployment and reduced hours for many, conversations with customers are appropriately targeted to respectfully identify any recent changed circumstances as they help in establishing affordable and sustainable arrangements to assist customers. This sector will also be affected by changes in workflow as most banks and originating creditors halt or reduce debt sales until the economy returns to some normalcy.

 

So why do some agencies appear more resilient than others? On inspection, the resilient ones all seem to have a few crucial areas in common which is helping them navigate this crisis better than others.  

The first is:

Client Base 

Never before has the 80/20 rule been more relevant. Whether agencies are involved in recoveries or investigations, if the business has 80% of its clients in a specific industry sector that is profoundly affected by the virus e.g. hospitality, council rate recoveries, banking or surveillance, the chances are these businesses are feeling the pinch significantly.

Agencies with a wide spread of clients and different industry sectors appear to be dealing with the crises significantly better.

Compliance and Management

Other standout factors are the effort and importance agencies placed on compliance and management structures before the virus. This crucial area of any business is highlighting the importance of business continuity & crisis management plans. These have never been more important.

Agencies who have spent the time and effort achieving compliancy standards in management and data security systems standout and have a higher chance for survival.

Technology & Flexibility

No matter what business you're in, the ability for your people to work from home is now a must. Some agencies have handled the transition well with a seamless conversion for most staff to set up at home and be productive almost immediately.

However, many have struggled with outdated phone systems, computer programs that don’t allow secure access for clients, staff or field operatives.

Agencies that have made an effort and invested in their systems and technology are performing much better.

Opportunities

No matter what industry or profession you are in it’s time to be focused on new and potential opportunities for the future Check with your marketing professionals for what you can do better to connect with your customers and to grow your base.

Accountancy firms have also gone out of their way to help, some offering a large amount of free advice, ask your accountant for this advice so you’re equipped for the pandemic and beyond.

While it will take some months, if not years for businesses to regroup, the time is now to assess your clients base and the potential of new opportunities in the coming months. Never be afraid to ask your client "Can we help?"

We see businesses continue to outsource services to either reduce internal staff and liability in the short term or they physically are overwhelmed by requests for hardship and amendments to contracts.

The future

If I hear one more person tell me, “You guys (as an industry) are going to be busy when this is all over”, I think I’ll scream! Who knows where the next six months or the next 6 days will take us? One thing is for sure the whole industry, whether investigations or recoveries, is being affected in some way or form. We are already hearing clients’ attitudes changing in the way they are interacting with their customers as this economic disaster unfolds.

This attitude shift may have a lasting effect on all avenues of our industry, especially in the short term and definitely into the future.

Some economists have claimed that it will take 10 years for this period to work itself out. Short term we see at least six months, being quieter than average in all areas. The businesses that have invested in their systems, people, technology & are focused on the future have a higher chance of survival.

One thing is for sure, every agency no matter what area you service will look a lot different than before the crisis.

 

Steve Wallis

Managing Director of SWA Recovery & Investigation Group.

E: Steve@swagroup.net.au

T: 1300 557 864

 

Steve is the Chairperson of the Institute of Mercantile Agents’ Process Serving Committee