The debt collection procedure:

Many German companies hold on to their overdue accounts far too long, in the hope of doing an effective collection effort on their own, finally getting paid without having to surrender their profit by paying a collection agency's fees. Often, these foreign creditors simply just don’t trust a German lawyer to help them by being truthful and acting professionally, or that if a third party gets involved, the company's business relationship with their debtors will end, when there is probably room for more business.
What happens is that, by operating on these assumptions, accounts grow old, cash flow is severely reduced, and there is a dramatic increase in the possibility of the account turning uncollectible. Truthfully, there is no need to surrender that much profit when hiring a German collection agency, and there are ways to ensure that you are choosing the one that can do the best debt collection job in Germany for all clients.
Law firms:
Whether you are intending to hire a law firm or a single lawyer, you can be sure that the legal professional is a specialist and has wide experience in debt collections. Lawyers have an approach to collections that most debt collection agencies simply don’t have. Many lawyers are professionals who have the power to intimidate a client in Germany with the threat of filing suit. That’s the lawyer’s biggest weapon. If a debtor doesn’t want to pay, he will simply be taken to court. That is where the lawyer's power resides, but it is also a weakness.
On the contrary, a debt collector has the power to persuade a debtor - through excellent selling skills - and to find and reach agreement on the best possible terms to avoid lawsuits and effect recovery sooner than would be the case through bringing suit. In debt collections, you need to give yourself a chance to persuade debtors to pay voluntarily before engaging in litigation. This is something that only a specialist can do.
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