When a company has slow turning accounts receivable and higher than normal days outstanding, our objective is to convert between ten and forty percent (10-40%) of their accounts receivable asset into cash. This is done by accelerating accounts receivable turnover and reducing days outstanding.

As the following example demonstrates, the benefits can be significant:

Before: Assume a company with $15 million in revenue sold on open account maintains a total of $2 million in accounts receivable. This means the receivables turnover 7.5 times per year and the average invoice is being paid at 48.6 days.

After: Assume we begin managing the company's accounts receivable, collection and litigation functions. Revenues remain at $15 million but now the receivables turnover 10.7 times per year. This means the average invoice is being paid at 34 days. This reduces total receivables from $2 million down to $1.4 million. The "missing" $600,000 goes directly to the company.

This service increases a company’s cash flow, frees up personnel time, and provides additional working capital. We may also manage a company’s credit functions and are able to structure an individual program to meet the needs of most companies. Our objective is to reduce receivables while increasing cash by an equal amount.

We mostly work with manufacturers and distributors with enough receivables to realize significant benefit.

LIQUIDATIONS & LITIGATION

We have collected and litigated entire portfolios of accounts receivable when a company ceases operations. We may also purchase outright these portfolios for our own account and subsequently collect and litigate as necessary.

We have converted up to 40% of a company's total accounts receivable base into cash by implementing our accounts receivable management and collection program.