Client Overview
- Client: Acme Supply Co.*
- Industry: Plumbing and Electrical Supplies
- Debtor: Delta Construction Services*
- Location: Oklahoma City, OK
- Initial Debt Amount: $34,716.29
- Debt Age: Over 12 months
Situation
Acme Supply Co., a major supplier of plumbing and electrical supplies in Oklahoma City, engaged Burt and Associates to recover an overdue debt of $34,716.29 from their debtor, Delta Construction Services. Despite initial payment arrangements, Delta Construction had missed multiple payments, severely impacting Acme Supply’s cash flow.
Challenges
- Missed Payments: Delta Construction initially agreed to a payment plan but failed to comply consistently, leaving the debt unresolved for over 12 months.
- Complex Negotiations: The debtor’s inconsistent communication and delayed responses made maintaining a structured payment plan difficult.
- Aged Debt: The older the debt, the more challenging it becomes to recover the full amount, as debtors may deprioritize payments or dispute terms.
Approach by Burt and Associates
Burt and Associates employed a structured recovery strategy with Acme Supply, focusing on building debtor trust while firmly negotiating to ensure compliance with the agreed terms. The key steps included:
- Structured Communication: Systematic follow-ups with Delta Construction, including phone calls and emails, ensuring communication was well-documented.
- Payment Plan: Initially, the debtor agreed to pay $3,500 monthly, with post-dated checks and an ACH draft setup. This allowed Acme Supply to anticipate cash inflow and better manage financial planning.
- Firm Follow-up on Defaults: When Delta Construction failed to honor payments, Burt and Associates used negotiation tactics involving discussions on lien rights, legal escalation, and frequent follow-up to encourage compliance.
Timeline of Events
- Debt Recovery Timeline
- January 2020: Burt and Associates initiated contact with Delta Construction and established a payment plan of $3,500 monthly installments, with ACH drafts arranged for the 15th of each month.
- February – May 2020: Regular payments were made as per the agreement. Each payment was followed up with consistent confirmation.
- August 2020: A post-dated check arrangement was made, securing future payments.
- December 2020: The debtor defaulted on an automatic payment. Burt and Associates intervened immediately, speaking with the debtor to resolve the NSF (non-sufficient funds) issue.
- January 2021: The payment plan was reinstated after a successful negotiation, and all remaining payments were completed as scheduled.
Resolution Acme Supply’s $34,716.29 debt was successfully recovered through professional negotiation and continuous monitoring. The debtor resumed and fulfilled their payment obligations, ensuring full debt recovery without legal action. Outcome and Key Takeaways- Debt Recovery: Burt and Associates recovered 100% of the debt for Acme Supply, restoring their cash flow.
- Payment Plan Strategy: The structured payment plan allowed Acme Supply to recover the amount over a set period, reducing the financial burden of the aging debt.
- Professional Handling: Despite initial resistance from the debtor, the firm but professional approach maintained business relationships while ensuring compliance with payment terms.
- Proactive Communication: The key to success was consistent follow-up and effective communication that kept both Acme Supply and Delta Construction engaged throughout the process.
*Names used in this case study are fictitious to protect the identity of the parties involved. However, all amounts, timelines, and other details accurately reflect the real scenario
As a finance manager, you understand the importance of a smooth and timely financial close. But even with the best strategies, challenges can arise. That’s where the right partnership can make all the difference. At Burt and Associates, we specialize in tailored, ethical debt collection practices that align with your business goals. By integrating our services, you can focus on optimizing your financial close process without the added stress of managing overdue accounts.
We know every business is unique, and that’s why we work closely with you to develop a customized approach that meets your specific needs. Whether you’re dealing with complex financial situations or simply looking to improve cash flow, our team is here to support you every step of the way.
Let’s turn those strategies into results together. Take the first step towards a more efficient financial close by reaching out to us today.
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At Burt and Associates, we prioritize building strong business relationships through tailored, ethical debt collection practices. Choose the approach that best fits your needs, and let’s take the first step toward improving your cash flow. If you have questions, please chat with Burt Bot for quick assistance.
