Collection Agencies Revenue Benchmarks
The average collection agencies business in the United States generates $3.6M in annual revenue, according to the U.S. Census Bureau Statistics of U.S. Businesses (SUSB 2021). There are 2,748 collection agencies businesses in the U.S., employing 114,565 workers with an average profit margin of 8.0%. The average employee in this industry earns $63K per year (Bureau of Labor Statistics QCEW 2023).
What Does a Collection Agencies Business Actually Do?
Debt collection agencies working consumer and commercial debt on contingency or as purchased debt buyers.
Who buys: Original creditors placing debt for collection, or debt-buyer firms.
Average Revenue
$3.6M
per year
Profit Margin
8.0%
industry average
Revenue / Employee
$87K
per year
Total Businesses
2,748
in the US
Est. Owner Income
$291K
small business avg
Labor Cost
55.0%
of revenue
Avg Employee Wage
$63K
per year (BLS)
Market Saturation
0.8
firms per 100K people
How Much Do Collection Agencies Charge?
Debt collectors earn a percentage of amounts recovered from debtors.
| Service | Typical range |
|---|---|
Consumer debt (first-placement) | 25–35% contingency |
Consumer debt (secondary/older) | 35–50% |
Commercial debt | 15–35% |
Purchase-debt model (buy debt for cents) | buy for 4–15¢ on the dollar |
Ranges based on industry rate surveys and typical published pricing. Actual quotes vary by city, business size, and job complexity.
Complete collection agencies business plan
A 12-section data-backed business plan for a collection agencies business — executive summary, market analysis, competitive landscape, revenue model, 3-year financial projections, operations, marketing, staffing, funding request. Pre-populated with real Census, IRS, and BLS data on this industry. Free to view.
Cost Structure — Where Every $100 in Revenue Goes
Approximate P&L breakdown for the collection agencies industry. Labor share and net profit are grounded in Census SUSB and IRS SOI data. Other lines are split using sector-typical ratios.
| Category | Per $100 revenue | Per typical business | What's in it |
|---|---|---|---|
Direct service costs | $7 | $269K | Cleaning supplies, uniforms, equipment consumables — depends on service type. |
Wages & benefits | $55 | $2.0M | Payroll for all employees at the business (owner comp not included for small owner-operators). |
Rent & facilities | $6 | $202K | Rent or mortgage on business location plus utilities tied to the space. |
Marketing & advertising | $4 | $135K | Google/Meta ads, SEO, print, referral fees, event sponsorships. |
Other operating costs | $20 | $740K | Insurance, background checks, training, transportation, admin. |
Net profit | $8 | $291K | What remains for the owner or shareholders after all business expenses. |
Directionally accurate for a typical business in the industry. Individual businesses vary widely — a franchise may run a very different cost mix from an independent, and older established businesses often have lower labor share than newer ones.
Average Revenue by Business Size
Industry Dynamics (Census BDS 2023)
New Business Rate
8.81%
openings/year
Closure Rate
13.14%
closings/year
Net Job Growth
-7.8%
annual
Businesses Closed
2,058
in 2023
Firm Count Trend
Should You Start a Collection Agencies Business?
Startup Cost
$50K – $250K
Break-Even
6 months
5-Year Survival Rate
50.0%
Related Industries
Frequently Asked Questions
- What does a collection agencies business do?
- Debt collection agencies working consumer and commercial debt on contingency or as purchased debt buyers. Original creditors placing debt for collection, or debt-buyer firms.
- How much do collection agencies charge?
- Debt collectors earn a percentage of amounts recovered from debtors. See the pricing table above for typical rates by service type.
- How much does the average collection agencies make per year?
- The average collection agencies business generates $3.6M in annual revenue, based on U.S. Census Bureau data (SUSB 2021). After expenses, the estimated owner profit is $291K per year at a 8.0% profit margin.
- How many collection agencies businesses are there in the US?
- There are 2,748 collection agencies businesses operating in the United States, employing a total of 114,565 workers.
- How much does it cost to start a collection agencies business?
- Startup costs for a collection agencies business typically range from $50K to $250K, with a 5-year survival rate of 50.0%.
- What is the average salary in the collection agencies industry?
- The average employee in the collection agencies industry earns $63K per year, according to Bureau of Labor Statistics data (QCEW 2023).
Industry Growth & Survival
The collection agencies industry is contracting — losing jobs at a net rate of 7.8% per year. More establishments are closing (13.1%) than opening (8.8%), suggesting market challenges.
Approximately 49% of collection agencies businesses survive their first 5 years. This is near the national average (~50%), with typical business risk. In 2023, 2,058 firms in this industry closed permanently.
Employment & Wages
The average employee in the collection agencies industry earns $62,572/year. This is near the national average of ~$65K. With 6,231 establishments employing 92,711 people, the typical business has about 15 employees.
Industry Trend (2000–2023)
The collection agencies industry has declined 23% since 2000 (from 25,410 to 19,450 firms).
See full historical statistics →Compare Collection Agencies revenue with other industries: