Cash Flow Management System

Transcription

1 The ARMS Group (WA) Pty Ltd Cash Flow Management System PO Box 324 Maddington Western Australia 6989 Phone Fax

2 The ARMS Group On behalf of myself and my team I would like to thank you for using the ARMS Group (WA) Pty Ltd. The ARMS Group (WA) Pty Ltd is a Western Australian owned and operated company, with a strong affiliation with the ARMS Group providing a local personal service with national representation. Our Services Whilst we have numerous services and facilities that can assist your business, we still like to ask our clients the most important question : How can we help you! Cash Flow Management System The Cash Flow Management System is designed to act as an extension of your own internal CREDIT DEPARTMENT, and should be used to contact your current overdue customers (or debtors) who just need that little nudge. This service will not : collect genuine Bad Debts or Missing Clients, those accounts who have constantly refused to pay or have left address without notifying their current whereabouts. fix disputed accounts or accounts on which repeated demands have been ignored. Such accounts should be urgently forwarded to our Account Managers for professional collection action or location of new address. Why send current overdue accounts? Every business that operates is out to make a profit? Unfortunately, the longer an account is overdue, the underlining profit margin is eroded with interest rates, and overdraft fees. By the time the account is 120 days overdue, any profit margin is generally non-existent, and the account is less likely to be collectable. By utilising the Cash Flow Management System for accounts that become 60+ days overdue, your organisation can increase it s cash flow, preserve it s profit margin, and have a better opportunity of collecting overdue accounts before they become bad debts. The Arms Group (WA) Pty Ltd Page : 2 of 11

3 Overdue Accounts Coupons are purchased in booklets of 25, 50, 75, or 100. Accounts can also be lodged electronically. A coupon entitles you to send one overdue account to us. For your convenience, all coupons are pre-printed with your information on them. Forwarding an Account for Collection To forward an account for collection, complete the debtor details on the coupon, and select the type of service that you require by a tick in the 3 letters or 2 letters/call box. Any coupons received without this box ticked are assumed to be either : a) 3 letters series; or b) your predetermined default We recommend that you also complete the debtor details on the coupon stub for your records. Fax/mail your coupon to us or PO Box 324 Maddington WA. Electronic Lodgment is available for clients wishing to send a regular volume of accounts (files of 50+ accounts). A brief specification is available within this document, for more detailed information booklet on the Electronic Lodgment process please contact this office. The Arms Group (WA) Pty Ltd Page : 3 of 11

4 Cash Flow Management System The Cash Flow Management System is an extension to your Credit Department, therefore flexibility is a key element of this service. The standard options are : 3 Letters Send the first letter to the overdue customer; If no payment, 14 days later send the second letter to the overdue customer; If no payment, 14 days later send the third letter to the overdue customer. 2 Letters/Call Send the first letter to the overdue customer; If no payment, 14 days later send the second letter to the overdue customer; If no payment, 14 days later contact the overdue customer. A sample of the letters can be found later in this information booklet. Customizing the Cash Flow Management System Whilst the above two options are the most commonly used, the Cash Flow Management System can be customized to suite your organisation. For example, we can : alter the number of days between actions (default 14 days); send the second letter, then the third letter and then make a call; send the first letter, then the third letter, and then make a call; automatically convert all debts over $ to professional debt recovery if they have not been paid within the Cash Flow Management System. Depending on the volume/industry, we can even look at altering the context of the letter. With the Cash Flow Management System our question to you is : How can we help you! The Arms Group (WA) Pty Ltd Page : 4 of 11

5 After the CFMS If the account still remains unpaid after the Cash Flow Management System you will need to determine if the account warrants professional debt recovery. Professional Debt Recovery With professional debt recovery your account manager personally reviews the account and decides what action is appropriate. Such action could include : Telephone Call Legal Action Pending Letter (if letter 3 was not used in the Cash Flow Management System) Field Agent Call to establish the viability of Legal Action Searches to determine Asset Values & Encumbrances Commencement of Legal Action Commission Accounts that are transferred to professional debt recovery are subject to your standard commission rate, disbursement costs, and fees/charges. The Arms Group (WA) Pty Ltd Page : 5 of 11

6 Reordering Coupons Inside every coupon booklet is our re-order form. To reorder, simply complete the Coupon Reorder form and fax/mail your coupon to us or PO Box 324 Maddington WA. Alternatively you can call us on and we will forward a new booklet to you as soon as possible. The Arms Group (WA) Pty Ltd Page : 6 of 11

7 The First Letter The first letter is a soft introductory letter, it identifies that we are acting on your behalf, and identifying that we require payment within 7 days. The Arms Group (WA) Pty Ltd Page : 7 of 11

8 The Second Letter The second letter confirms that we have not received a payment as yet, and gives the customer the opportunity to contact you and discuss any problems that they may have with the product or service, or even with paying the account. If there is a problem then it is in everyone s interest to resolve the issue so that there is no longer any reason for the customer not to pay the account. If the customer is having financial difficulties, then it is better to get something each month than nothing at all! Often financial problems are only temporary. The Arms Group (WA) Pty Ltd Page : 8 of 11

9 The Third Letter The third letter lets the customer know in no uncertain terms that a summons will be issued should they ignore this notice and fail to pay the account. The Arms Group (WA) Pty Ltd Page : 9 of 11

10 Electronic Lodgment Your account information can be lodge with us in electronic format by , diskette, or CD-Rom. Please contact us should you require additional information. Information is accepted in ASCII Text Comma Delimited format, the data structure is identified below : Data Record 1 First Name 2 Surname 3 Address 1 Street Number & Name 4 Address 2 (or Null) 5 Address 3 Suburb 6 Address 4 State Post Code 7 Telephone Number 8 Date of Debt dd/mm/yyyy 9 Debt Amount $$$.cc 10 Reason for Debt (or Null) 11 Client Reference Field 12 Date of Birth dd/mm/yyyy 13 Legal Indicator Y or N 14 Client Information Trailer/Total Record (Optional) 1 Identifier TOTAL 2 Number of Records Value of Records $$$.cc 4 NULL 5 NULL 6 NULL 7 NULL 8 NULL 9 NULL 10 NULL The Arms Group (WA) Pty Ltd Page : 10 of 11

11 Cost Effectiveness & Costs Having a third party acting as an extension to your credit department is more affective, and provides you with additional personnel resources to service your clients. What do you Save? Before considering the cost of this service, ask yourself these questions : a) How much time and money do you spend performing this task? Remember the true cost includes postage, stationery, staff time etc b) Do you need more time to service your customers? Cost Effectiveness Value of Debt Cost Effectiveness (Saving) per Account $ $5.00 $ $35.00 $ $50.00 $1, $ Based on Standard Commission Rate if the Account is Collected with Cash Flow Management System! COSTING To use the Cash Flow Management System you need to purchase collection coupons. Coupons are sold in booklets of 25, 50, 75, 100 and must be paid for in advance. No other fees are payable, unless litigation and/or debt recovery actions is necessary and is requested by you. Number of Coupons Purchased Cost Per Coupon Booklet of 25 Coupons $15.00 Booklet of 100+ Coupons $13.00 Prices displayed are subject to change without notice! The Arms Group (WA) Pty Ltd Page : 11 of 11