The Best Time of Year to arrange a Business Debt Settlement?

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As we approach the year-end, this can be the best time for your company to work out a business debt settlement.  No firm likes to carry delinquent receivables into the New Year, especially when it coincides with the accounting year-end.

It’s an established fact that the longer a company has to wait for a B-to-B receivable, the more likely it is to go unpaid.  This applies in general, but in this economy, formerly strong customer firms are dropping like flies.

Smart owners and controllers understand this risk, when looking at delinquent B-to-B receivables.  They recognize the differences in the situations faced by debtor customers.  If your firm is genuinely in need of business debt relief, a clear and concise business debt settlement proposal can go far to bring about a solution to help both sides.

Companies that attempt to collect every dime owed from every business customer can end up with a lot less than expected. It pays for them to be flexible and to heed what’s happening to them.  You likely have the same situation with receivables of your own.  You understand that creditors need further information before coming to any decision on how to proceed.

A proverbial bird in the hand is worth two in the bush.  A creditor firm will have to wait for months, after retaining an
attorney to file suit, to find out if a lawsuit is productive.  In other words, to actually be awarded a judgment.  And then, for management to hope and pray that full restitution will be transferred from the debtor’s bank account to theirs.

It often ends up as a piece of paper to stash in the “uncollected judgment” file.  It’s far better, in many cases, for a
creditor to carefully consider a negotiated debt settlement.  The outcome can be more positive and less
stressful to each party.

This is the time of year for you to consider making business debt settlement offers to your creditors, if you need these to survive.  A complete debt management workout may be called for, as a better option to Chapter 11 bankruptcy.  Deals can be as varied as circumstances warrant, be they drop-dead cash settlements or long-term payment plans, or a combination of both.

In following through with your plan, your creditors will minimize their immediate losses.  You will figuratively shake hands after deals that meet each party’s needs.  You get the opportunity to manage a strong business turnaround, while giving your creditors your future customer value.  And what could be better than that?

 

 

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One Response to “The Best Time of Year to arrange a Business Debt Settlement?”
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