Collection News/updates
8/3/2009 11:09:00 AM
Credit Research Foundation Releases Second Quarter Receivable Report
The Credit Research Foundation released its Report on Domestic Trade Receivables for the Second Quarter of 2009 and it shows shifts in the condition of its members’ accounts receivables portfolios. The following figures summarize the report:
The Collection Effectiveness Index rose by approximately 3.62 percent when compared to the first quarter.
When the second quarter of 2009 is compared with the same quarter in 2008, it rose by about 3.23 percent. While not a large increase it does show an improvement.
DSO when compared to the first quarter was up slightly, but this was probably because of the influence of sales on DSO. (DSO is influenced by rising or falling sales. Rising sales leads to a declining DSO while falling sales, the current environment we find ourselves in, leads to a rising DSO. This is a statistical or mathematical effect on the figures and needs to be kept in mind when analyzing DSO trends.)
The Average Days Delinquent declined; the Percent Current on CRF Members’ Aged Trial Balances improved; and the Percent Over 91 Days Past Due declined significantly from the first quarter—about 29.3 percent. However, Percent Over 91 Days Past Due, remained above the level reported for the second quarter of 2008.
This improvement in the Accounts Receivable Portfolios of CRF members may mean that in the third quarter of 2009 we will see a slowing in account placement with CCAA Members.
The complete report may be purchased from Credit Research Foundation by visiting their website, www.crfonline.org.7/20/2009 10:01:00 AM
New Record Set: Business to Business Accounts Placed for Collection Continue to Rise
For the 12 months ending June 2009, members of the Commercial Collection Agency Association of the Commercial Law League of America (CCAA) received a record volume of commercial or business-to-business accoounts placed for collection. Almost $17 billion in accounts were received. This represents an increase of about 39.5 percent over the 12 months ending June 2008.
In the second quarter of 2009, approximately $4.6 billion in account placement was received by CCAA members. This represented a 39.5 percent increase over the second quarter of 2008.
"The second quarter 2009 figures represent a strong increase in business-to-business account placement and an acceleration of the trend started in the fourth quarter of 2008," said Emil Hartleb, CCAA executive director. "We believe the increased account placement is reflective of the tight availability of credit and and a slowdown in sales, which has caused a cashflow crunch for small and medium size business. Most economists beleive this situation will prevail into the fourth quarter of this year before improvement is noted."
While the collectability of the accounts placed for collection has declined, CCAA members reported that profit margins have only been modestly impacted. It is not expected that account placement will continue to rise to the levels experienced in the first and second quarters of 2009. However, in a recent survey CCAA members believe that third and fourth quarter 2009 account placement will continue to be strong.
"These times continue to be problematic for American business as bankruptcies rise and a greater number of customer accounts on companies' aged trial balances move to the 60 and 90 day columns, representing an increase in day sales outstanding (DSO) and a decrease in cash flow," said Hartleb. "Companies have become more selective in their credit decisions and are watching and reacting faster to slower paying customers and placing them for collection with CCAA members faster."
4/22/2009 11:13:00 AM
Business to Business Accounts Placed for Collection Continue to Rise and Set a Record
For the twelve months ending March 2009, members of the Commercial Collection Agency Association of the Commercial Law League of America, (CCAA) received a record volume of commercial or business-to-business accounts placed for collection. Over $15.4 billion in accounts were received. This represents a percentage increase of 27.2 percent over the twelve months ending March 2008.
In the first quarter of 2009, approximately $4.2 billion in account placement was received. This represented 34.6 percent increase over the first quarter of 2008.
"These times continue to be problematic for American business as bankruptcies rise and a greater number of customer accounts on companies' aged trial balances move to the sixty and ninety day columns representing an increase in Day Sales Outstanding (DSO) and a decrease in cash flow," said Emil Hartleb, CCAA executive director. "Companies are becoming more selective in their credit decisions and watching and reacting faster to slow paying customers."
2/23/2009 11:14:00 AM
Defining a Discharge in Bankruptcy
The Administrative Office of the U.S. Courts defines a discharge in bankruptcy in the following manner:
"A bankruptcy discharge releases the debtor from personal liability for certain specified types of debts. In other words, the debtor is no longer legally required to pay any debts that are discharged. The discharge is a permanent order prohibiting the creditors of the debtor from taking any form of collection action on discharged debts, including legal action and communications with the debtor, such as telephone calls, letters, and personal contacts. Although a debtor is not personally liable for discharged debts, a valid lien (i.e., a charge upon specific property to secure payment of a debt) that has not been avoided (i.e., made unenforceable) in the bankruptcy case will remain after the bankruptcy case. Therefore, a secured creditor may enforce the lien to recover the property secured by the lien. "(Bankruptcy Week, Vol. 9, No. 8, February 23, 2009.)
12/17/2008 1:08:00 PM
Accounts Receivable: The Bank of Last Resort
Credit Today conducted a roundtable discussion where trade credit leaders met to discuss the current credit crisis. The group made some stark predictions about the economy, and the key findings are now available.
Click here to read the full release.
11/12/2008 1:05:00 PM
Surviving the Credit Crisis - Managing Receivables
The latest white paper from The Credit Research Foundation, Managing Receivables in the Midst of Today's Economic Environment, focuses on the potential impact it will have on your business.
After reading this white paper we encourage you to contact NCS to review your current credit procedures to make sure you are in the best position to get paid. For 38 years NCS has been the expert in providing solutions to Secure Your Tomorrow.
Click here to read the white paper.
This article is being reproduced with permission from The Credit Research Foundation.
10/10/2008 12:59:00 PM
Surviving the Credit Crisis
After reading this white paper, Lessons for Businesses to Learn from Today's Credit Crisis, we encourage you to contact NCS to review your current credit procedures to make sure you are in the best position to get paid. For 38 years NCS has been the expert in providing solutions to Secure Your Tomorrow.
Click here to read the white paper.
This article is being reproduced with permission from the Credit Research Foundation.
4/1/2008 10:14:00 AM
Collection Tip for April
FLEXIBLE:
Be ready to adjust to the situation. Think about the kind of customer you're dealing with and adapt to meet the circumstances. Be prepared to accept a reasonable payment schedule, and a willingness to deal with a customer's circumstances.
Call NCS Collection Services Group at 800-826-5256 for more information on how to help work with your customer's situations.
3/2/2008 10:06:00 AM
How to Choose a Collection Agency
Before you place an account with a collection agency be P.R.U.D.E.N.T.
PREPARE:
Review the paperwork on the debtor before making your collections calls. Know the history of the account, credit record, the promises kept/broken. Have all records in front of you, ready for reference.
REASONABLE:
Be reasonable and ready to adjust to the situation. Think about the kind of customer you're dealing with and adapt to meet the circumstances. Be prepared to accept a reasonable payment schedule, and a willingness to deal with a customer's circumstances.
UNFLAPPABLE:
Adopt a straightforward, professional business-like attitude. You have a contract, you delivered the goods, money is owed, and you have a right to expect payment. Never let it become personal. Don't yell or raise your voice; and NEVER swear. Don't threaten: legal action is your recourse.
DILIGENT:
Make sure you're talking to the right person. Don't let the individual brush you off with "You'll have to talk to the bookkeeper." Identify the person who will pay the bill. If you can't get through after several calls, tell the secretary that you know your calls are being screened. Indicate the purpose of your call and if necessary give deadlines.
EXECUTE:
Never leave a contact open ended, such as "We'll talk next week," or "I'll send what I can." Every contact should result in a commitment to payment, of a specific amount, by a specific date, even the check number the customer is using to pay the pledge.
NOTES:
Keep detailed, accurate notes of every contact with the customer. Probe for further information on the customer. Notes of these contacts will help you in subsequent phone calls, and may be invaluable in litigation. Good notes will also help in further credit decisions, or in cases where skip tracing may be needed.
TIME:
The longer an account is held, the less likely it is that it will be recovered. If payment or a payout is not arranged within 90 days, place the claim with a collection agency. Use only an agency that is a member of the Commercial Collection Agency Section of the Commercial Law League of America. This will ensure that you're dealing with ethical professionals who are fully bonded to guarantee your remittance.
Choose NCS!
Get prompt results with over 35 years experience in successful collections. NCS joins your Credit Department team to work to affect full payment ASAP. Our collectors contact debtors during legally mandated hours nationwide and will only take legal action once all in-house resources are exhausted. Throughout the entire process, we keep you informed of your account status with the reporting method of your choice.
NCS holds the Certificate of Compliance from the Commercial Collection Agency Section of the Commercial Law League of America
By design, NCS' recovery system is one of the most ethical, economical and fastest routes available. We invite you to compare.
