CorporateCollections.com

I'll be a guest on Rita Schiano's blog talk radio show this afternoon, talking about commercial debt collection.

Please tune in!

UPDATE: LINK

Let me know what you think.

08-12-2008 12:54:07PM - Permalink - Post Reply - Read Comments [0]

I got a call from a client in the food business today and he reported that his suppliers have started calling customers if they are one day late paying their invoices.

Grace periods have been tightened. An invoice due in 30 days a year ago, is now due in 15. If the invoice is not paid, the customer goes on COD terms.

I told my client he should be doing the same thing. Communication with your customers is always a good thing. Remind the customer that payment is due, and use the opportunity to make another sale.

One of the things that has always bugged me about the debt collection business is that the players often make it instantly adversarial. It doesn't have to be. You truly do get more flies with honey. It's important to remember that a company that is struggling isn't necessarily a bad company.

We get some business from collection agencies which refer cases to us in MA after their collection efforts have failed. Most of these agencies do a great job. On occasion though, the collector has made things so adversarial that the debtor refuses to pay the bill "on principle". That is simply a dumb situation to get into. I can think of four or five matters over the years where a debtor has agreed to pay the bill instantly, saying that the only reason for the delay is that the collector was so rude to him. We all have our off days. But if you are feeling angry, do not call a debtor. (Then again, it's an easy victory for me!)

07-09-2008 01:23:55PM - Permalink - Post Reply - Read Comments [0]

When the tech bubble began to burst eight years ago, it quickly was apparent that those companies who pursued their receivables quickly and skillfully could and did recover monies owed to them. Those who waited, hoping for a turnaround, lost out.

The climate for commercial debt collection remains fairly robust, although I often encounter debts owed by previously healthy companies who are simply not collecting their own receivables which in turn, makes it difficult for them to meet their payables. The trickle down effect is clear.

Now more than anytime over the last eight years it is important to pursue monies owed, quickly and skillfully. Failure could be catastrophic.

06-24-2008 05:26:16PM - Permalink - Post Reply - Read Comments [0]

The debt collection business cranks up in an economic downturn, and as a result is a bellwether for future events. At Woodworth & Frisella we are experiencing a mild up-tick in business, which appears to be gaining steam on a daily basis. More telling is the fact that most failures to pay are not about disputes but about cash flow.

In these times it is important to remember that whoever gets there first often is the one who gets paid. This is not the time to sit on your accounts receivable.

01-25-2008 05:55:16PM - Permalink - Post Reply - Read Comments [0]

Last night I was honored to Judge the semi-final round of the negotiation contest at my alma mater law school. The contest was among 1L's, who have been in law school for less than 2 months and they handled themselves beautifully. I judged two competitions, and both were very close contests. My thanks to the students at Boston College Law School for inviting me.

I've been thinking a lot about negotiation lately, partly in preparation for this competition, partly because I just read Gerald Williams' great article in the Commercial Law League Magazine on the same subject.

I have always thought of negotiation as more romance than table pounding. It's easier to make a deal with someone you like, rather than someone you loathe. So from the outset of any case, I actively seek common ground with my "opponent". Be it the CEO of the company, their talented lawyer, or the guy working part time in accounts payable, I look for something unrelated to banter about. It doesn't hurt that I'm a news junkie and so more often I just scan my brain for something happening where the other person is located, and we are off and running.

Along the way I've found that there are some pretty interesting people out there who owe my clients money. People can tell when you are genuinely interested, and I am. I learn something new from nearly everyone I deal with. It's one of the best parts of my job.

It's important to understand my adversary and his business - and in that process I'm often able to create a bond which results in an agreement to work together to find a solution to the problem. That is the beginning of any negotiation; it points both parties in the same direction - that of getting the problem solved, and it is more often than not, a huge leap forward in the process.

10-03-2007 02:03:23PM - Permalink - Post Reply - Read Comments [0]