Sometimes the debt collection process is unavoidable. If you’re a small business with a limited staff, hiring a debt collection agency can save you time and will allow you to focus your resources on running your business. Typically, collection agencies get better results because they have the time to make sure everything is right and have experience at collecting debts. The key in hiring a debt collection agency is finding a reputable company to assist you. Here are five tips to keep in mind when hiring a debt collection agency:

Do your research

Debt collection agencies often specialize in certain areas. For example, some excel in securing funds from large companies while others do well with small businesses. Find out what sort of debtors the collection agency most often deals with and what sort of businesses it serves. Find an agency that specializes in your type of business and that has collected debts in your industry. If you need help finding a debt collection agency, ask your accountant, attorney, other business contacts or local chamber of commerce for suggestions or recommendations.

Find out their collection tactics

Different states have different rules and regulations for debt collection agencies. You’ll want to hire one that is licensed and adheres to the rules of the Fair Debt Collection Practices Act. The Fair Debt Collection Practices Act provides guidelines for debt collectors who are collecting debts for household expenses, medical expenses, credit cards, auto loans and mortgages. Even if you don’t need to collect those types of debts, it may be a good idea to choose an agency that follows these practices. This will help ensure that overly aggressive collection tactics don’t harm your reputation.

Understand their fee structure

Collection agencies have a variety of fee structures. Some agencies charge a flat fee: a straightforward cost associated with pre-collection fees. This fee is generally offered early on in the debt collection process. Other agencies charge contingency fees: a percentage of the amount they collect is charged. Compare the fee structures for each prospective company to see which one works best for you and your goals.

Know how often you’ll be updated

It’s important for your debt collection agency to update you on the progress it has made with your delinquent accounts. This holds the agency accountable, but it will also help you recover the debts quicker if periodic updates are expected. Some agencies send multiple payments each month while other offer online tools that allow you to check on the progress of each account.

Ask about “skip tracking”

Unfortunately, sometimes debtors decide to skip town. To combat this, some agencies use what’s called “skip tracking.” Skip tracking is a practice in which the collection agency uses multiple databases to locate a debtor who has skipped town and moved to another city or state. This is especially important if you have been personally contacting a debtor and have been ignored.